Use the Following Information to Answer the Question(s)below

question 71

Multiple Choice

Use the following information to answer the question(s) below.
d'Anconia Copper is considering issuing one-year debt,and has come up with the following estimates of the value of the interest tax shield and the probability of distress for different levels of debt:
-If in the event of distress,the present value of distress costs is equal to $25 million,then the optimal level of debt for d'Anconia Copper is:

• A)$50 million.
• B)$60 million.
• C)$70 million.
• D)$80 million.

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Definitions:

Stressful

Characterized by or causing mental, emotional, or physical strain or tension.

Uplifts

Positive experiences or small victories that improve one’s mood or emotional state, often countering the impact of stress.

Emotional Expressions

Manifestations of feelings that may involve gestures, facial expressions, and vocal tone, serving communicative functions in social interactions.

Love

A profound, complex feeling of affection and attachment towards others, often characterized by emotional, physical, and social components.