Biotec Has Estimated the Costs of Debt and Equity Capital

question 55

Multiple Choice

Biotec has estimated the costs of debt and equity capital for various proportions of debt in its capital structure:
Based on these estimates, determine Biotec's optimal capital structure.

• A) 35% debt
• B) 40% debt
• C) 45% debt
• D) 50% debt

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Definitions:

Desirable Outcomes

Positive results or benefits that are sought after or desired by individuals or organizations from their actions or operations.

Productivity

The measure of efficiency in converting inputs into useful outputs, typically in terms of the rate of output per unit of input.

Groundbreaking Ceremony

A formal event marking the beginning of construction or the start of a major project.

Company President

A high-ranking executive in a company, often responsible for formulating and implementing policies alongside the board of directors and CEO.