Based on the Information Below for Benson Corporation, What Is

Multiple Choice

Based on the information below for Benson Corporation, what is the optimal capital structure?

A) debt = 50%; equity = 50%; eps = $3.05; stock price = $28.90.
B) debt = 60%; equity = 40%; eps = $3.18; stock price = $31.20.
C) debt = 80%; equity = 20%; eps = $3.42; stock price = $30.40.
D) debt = 70%; equity = 30%; eps = $3.31; stock price = $30.00.
E) debt = 40%; equity = 60%; eps = $2.95; stock price = $26.50.