Question: Debt ratio = 2 0 % , interest rate = 6 % , shares = 4 M EPS = $ 2 . 2 4 ROE

Debt ratio =20%, interest rate =6%, shares =4M
EPS=$2.24 ROE=11.20%
Debt ratio =50%, interest rate =8%, shares =2.5M
EPS=$2.80 ROE=14.00%
The 50% deby capital structure is better because the ROE and EPS is higher which indicates a more favorable financial performance for a company.

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