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Fama's Llamas has a weighted average cost of capital of 12.5 percent. The company's cost of equity is 15.5 percent, and its pretax cost of

Fama's Llamas has a weighted average cost of capital of 12.5 percent. The company's cost of equity is 15.5 percent, and its pretax cost of debt is 7.5 percent. The tax rate is 34 percent. What is the company's target debt-equity ratio?

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