Question: 1. Explain the graph below: 18 requity = expected return on equity 16 14 Passets = expected return on assets 12 10 Rates of return

1. Explain the graph below: 18 requity = expected return on

1. Explain the graph below: 18 requity = expected return on equity 16 14 Passets = expected return on assets 12 10 Rates of return (%) debt = return on debt 2 0 1 0.4 0.5 0 0.1 0.2 0.3 1.1 1.2 1.3 1.4 1.5 1.6 0.6 0.7 0.8 0.9 1 Debt-equity ratio, DIE

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