Biotec has estimated the costs of debt and equity capital for various proportions of debt in its capital...

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Finance

Biotec has estimated the costs of debtand equity capital for various proportions of debt inits
capital structure:
% of Debt
Cost of Debt
Cost of Equity
35
5.4%
13.8%
40
5.6
14.0
45
5.9
14.3
50
6.4
14.7
If Biotec pays a currentdividend of $1.50 and expects dividends to grow at a constant rateof 7%, what is the stock price if it obtains its optimal capitalstructure? What does the capital structure mean?

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Biotec has estimated the costs of debtand equity capital for various proportions of debt inits capital structure:% of DebtCost of DebtCost of Equity355.4%13.8%405.614.0455.914.3506.414.7 If Biotec pays a currentdividend of $1.50 and expects dividends to grow at a constant rateof 7%, what is the stock price if it obtains its optimal capitalstructure? What does the capital structure mean?

% of Debt	Cost of Debt	Cost of Equity
35	5.4%	13.8%
40	5.6	14.0
45	5.9	14.3
50	6.4	14.7