A firm’s optimal capital structure ______ is generally
a mix of 40% debt and 60% equity.
exists when the debt-equity ratio is 0.5.
is the debt-equity ratio that exists at the point where the firm’s weighted after-tax cost of debt is minimized.
is the debt-equity ratio that results in the lowest possible weighted average cost of capital and the largest firm value.
If a stock has beta 1.5, how to interpret it?
The stock is riskier than average.
The stock has average risk.
The stock is less risky than average.