Question

As a general rule, the capital structure that

a. Maximizes expected EPS also maximizes the price per share of common stock.

b. Minimizes the interest rate on debt also maximizes the expected EPS.

c. Minimizes the required rate on equity also maximizes the stock price.

d. Maximizes the price per share of common stock also minimizes the weighted average cost of capital.

e. None of the above.

Answer

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