As a General Rule, the Optimal Capital Structure Is the One

question 74

Multiple Choice

As a general rule, the optimal capital structure is the one that:

• A)maximizes both the firm's expected EPS and its stock price.
• B)minimizes the interest rate on its debt and maximizes its expected earnings per share.
• C)minimizes its required rate on equity and maximizes its stock price.
• D)maximizes its stock price and minimizes its weighted average cost of capital.
• E)minimizes its expected earnings per share and maximizes its weighted average cost of capital.

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Definitions:

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