Given the following information, fill out the following table and determine what should be the optimal...

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Finance

Given the following information, fill out the following tableand determine what should be the optimal capital structure forConcours Corp. The company has $10 million in assets, a marginaltax rate of 30%, and each million in debt used causes Rd toincrease by 1.0% and Rs to increase by .8%.

DebtRdRsWACC
0--12%12%
$1 Mill
$2 Mill
$3 Mill
$4 Mill
$5 Mill
$6 Mill
$7 Mill
$8 Mill

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Transcribed Image Text

Given the following information, fill out the following tableand determine what should be the optimal capital structure forConcours Corp. The company has $10 million in assets, a marginaltax rate of 30%, and each million in debt used causes Rd toincrease by 1.0% and Rs to increase by .8%.DebtRdRsWACC0--12%12%$1 Mill$2 Mill$3 Mill$4 Mill$5 Mill$6 Mill$7 Mill$8 Mill

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