Question: 6. Determining the optimal capital structure Aa Aa E Understanding the optimal capital structure Review this situation: Universal Exports Inc. is trying to identify its



6. Determining the optimal capital structure Aa Aa E Understanding the optimal capital structure Review this situation: Universal Exports Inc. is trying to identify its optimal capital structure. Universal Exports Inc. has gathered the following financial information to help with the analysis. Debt Ratio Equity Ratiord 30% 40% 50% 60% 70% 70% 60% 50% 40% 30% 6.02% 6.75% 7.1596 7.55% 8.24% 9.40% 9.750% 10.60% 11.30% 12.80% WACC 9.71% 9.55% 10.02% 10.78% 11.45% Which capital structure shown in the preceding table is Universal Exports Inc.'s optimal capital structure? Debt ratio-30%; equity ratio 70% 0 Debt ratio +40%; equity ratio 60% Debt ratio-60%; equity ratio-40% Debt ratio-50%; equity ratio-50% O Debt ratio 70%, equity ratio 30%
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
