What is the weighted average cost of capital at the optimal structure?

s Web site. Reac Show more Start with the partial model in the file Ch15 P12 Build a Model.xls on the textbooks Web site. Reacher Technology has consulted with investment bankers and determined the interest rate it would pay for different capital structures as shown in the following table. Data for the risk-free rate the market risk premium an estimate of Reacher s unlevered beta and the tax rate are also shown. Based on this information what is the firm s optimal capital structure and What is the weighted average cost of capital at the optimal structure? Percent Financed with Debt (Wd) 0% 10% 20% 30% 40% 50% 60% 70% Before-Tax Cost Debt (rd) 6.0% 6.1% 7% 8% 10% 12.5% 15.5% 18.0% Input Data Risk-free rate 4.5% Market risk premium 5.5% Unlevered beta 0.8% Tax rate 40.0% ***Please should the work/formulas**** Show less

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