1. Determining the optimal capital structure Understanding the optimal capital structure Review this situation: Transworld Consortium Corp. is trying to identify its optimal capital structure. Transworld Consortium Corp. has gathered the following financial information to help with the analysis. Which capital structure shown in the preceding table is Transworld Consortium Corpi's optimal capital structure? Debt ratio = 50\%; equity ratio =50% Debt ratio =30%; equity ratio =70% Debe ratio =40%; equity ratio =60% Debt ratio =70%; equity ratio =30% Debt ratio =60%; equity ratio =40% Which capltal structure shown in the preceding table is Transworld Consortium Corp.'s optimal capital structure? Debt ratio =505; equity ratio =50% Debt ratio =30%; equity ratio =704 Debt ratio =40%; equity ratio =60% Debt ratio =70%; equity ratio =30% Debt ratio =60%; equity ratio =40% Consider this case: Globex Corp, currently has a capital structure consisting of 35% debt and 65% equity. However, Globex Corp.'s CFO has suggested that the firm increase its debt ratio to 50%. The current risk-tree rate is 3.5%, the msrket risk premium is 7%, and Globex Corp.'s beta is 1.25