Matlab graphical optimum point

I'm trying to formulate the CAPM and here is what i'm trying to work with:

Rf =.3 ;
B = .95; 
Rm = .11;

Ra=Rf+(B*(Rm-Rf));

E = 1000; 
D = 1000;

Rd=.02;
Tc = .26; 
V=E+D; 
WACC=(E/V)*Ra+((D/V)*Rd*(1-Tc));
I=500 
S=Rd/I

and represent this on a graph with D/E, WACC and S as axis for a varying D/E.

and I'm trying to find the optimum pouint on the graph for E and D while keeping

S<.36

and WACC to minimum

Many many thanks in advance.

Answer 1

[K E]

I believe you are varying D, E, Rd, and I (they are finite in your example), and that you seek to optimize WACC. In general if you vary 2 independent values, S and D/E, to obtain the dependent value, WACC, you can manually seek the max value by plotting

pcolor(S, D./E, WACC)

Or find the max value as follows,

max(max(WACC(S<0.36, :))) % max over both rows and columns

assuming WACC(S, D./E) is a 2D matrix and S and D./E are vectors. [CAPM = capital asset pricing model, WACC = weighted average cost of capital. New terms to me!]