Question

The optimal capital structure has been achieved when the: debt-equity ratio is equal to 1. debt-equity ratio results in the lowest possible weighted average cost of capital. debt-equity ratio is such that the cost of debt exceeds the cost of equity. weight of equity is equal to the weight of debt. cost of equity is maximized given a pretax cost of debt.

Answer 1

The optimal capital structure can be realized if : Debt-equity ratio selected results in the lowest possible weighted average cost of capital.

• An optimal capital structure can be regarded as best mix of debt as well as equity financing which maximizes a company's market value.

• And as well minimizing its cost of capital, it can be realized when Debt-equity ratio  that is been selected, gives the lowest possible weighted average cost of capital.

Learn more at:

brainly.com/question/10782180?referrer=searchResults