The optimal capital structure: minimizes the weighted average cost of capital. minimizes the cost of debt but not necessarily the cost of equity. maximizes the earnings per share. minimizes both the cost of debt and cost of equity. minimizes the cost of equity but not necessarily the cost of debt. ABC Inc. estimates that its below-risk projects have a cost of capital of 6%, its average risk projects have a cost of capital of 8%, and its above-average risk projects have a cost of capital of 10%. Which of the following projects (A, B, and C) should the company accept? None of the projects should be accepted. Project C, which is of above-average risk and has a return of 10.5%. All of the projects should be accepted. Project B, which is of average risk and has a return of 8.5%. Project A, which is of below-average risk and has a return of 6.5%. A project has an up-front cost of $150,000. All subsequent cash flows are positive. The project's required return is 10 percent and its net present value is - $10,000. Which of the following statements is most correct? The project's internal rate of return equals 10 percent. You need more information to determine whether the internal rate of return is greater than, less than, or equal to 10 percent. The project's internal rate of return is less than 10 percent. The project's internal rate of return is greater than 10 percent. I really should have come to class more often