Question: Problem 12-11 Finding the Target Capital Structure [LO 3] Famas Llamas has a WACC of 10.8 percent. The companys cost of equity is 14.2 percent,

Problem 12-11 Finding the Target Capital Structure [LO 3]

Famas Llamas has a WACC of 10.8 percent. The companys cost of equity is 14.2 percent, and its cost of debt is 8.4 percent. The tax rate is 40 percent.

Required:

What is Famas target debt-equity ratio? (Do not round intermediate calculations. Round your answer to 4 decimal places (e.g., 32.1616).)

Debtequity ratio

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