From the Information Below, Select the Optimal Capital Structure for Mountain

question 11

Multiple Choice

From the information below, select the optimal capital structure for Mountain High Corp.

• A) Debt = 40%; Equity = 60%; EPS = $2.95; Stock price = $26.50
• B) Debt = 50%; Equity = 50%; EPS = $3.05; Stock price = $28.90
• C) Debt = 60%; Equity = 40%; EPS = $3.18; Stock price = $31.20
• D) Debt = 80%; Equity = 20%; EPS = $3.42; Stock price = $30.40

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Definitions:

Airflow

The movement of air around or through an object, which is critical in various applications, including cooling electronic devices and aerodynamics for vehicles.

Engine

A machine designed to convert various forms of energy into mechanical force and motion, powering vehicles and other equipment.

Usable Power

The portion of power or energy that can be effectively used or delivered by a system without including losses or reserves.

Crankshaft

A mechanical part which translates the linear motion of pistons into rotational motion, fundamental to the functioning of an internal combustion engine.