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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?
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