Question: The optimal capital structure has been achieved when the Multiple Choice debt-equity ratio is such that the cost f debt exceeds the cost of equity.

The optimal capital structure has been achieved when the Multiple Choice

The optimal capital structure has been achieved when the Multiple Choice debt-equity ratio is such that the cost f debt exceeds the cost of equity. debt-equity ratio is equal to 1 the financial distress costs equals the present value of the tax shield on debt. present value debt. fequity is maximized given a pretax cost cost weight of equity is equal to the weight of debt

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