Considering the information in the table below, indicate which amount borrowed you believe to be the optimal level of debt and explain completely why Amount Borrowed Value of Equity Value of the Firm Stock Price WACC EPS 0 18,460 18,460 18 46 13 0 2 40 $ 2 Million 17,320 19,320 19 32 12 42 2 55 $ 4 Million 15,830 19,830 19 83 12 10 2 70 $ 6 Million 14,020 20,020 20 03 11 99 2 54 $ 8 Million 16,570 24,570 24 57 11 50 3 04 $10 Million 12,000 22,000 22 00 12 00 3 20 NOTE Value of the Firm is equal to the Amount Borrowed plus the Value of Equity

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Question: Considering the information in the table below, indicate which amount borrowed you believe to be the optimal level of debt and explain completely why. Amount

Considering the information in the table below, indicate which amount borrowed you believe to be the optimal level of debt and explain completely why.

Amount Borrowed	Value of Equity	Value of the Firm	Stock Price	WACC	EPS
0	18,460	18,460	18.46	13.0%	2.40
$ 2 Million	17,320	19,320	19.32	12.42	2.55
$ 4 Million	15,830	19,830	19.83	12.10	2.70
$ 6 Million	14,020	20,020	20.03	11.99	2.54
$ 8 Million	16,570	24,570	24.57	11.50	3.04
$10 Million	12,000	22,000	22.00	12.00	3.20

NOTE: Value of the Firm is equal to the Amount Borrowed plus the Value of Equity

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