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Fama's Llamas has a weighted average cost of capital of 6 . 5 percent. The company's cost of equity is 1 2 percent, and its

Fama's Llamas has a weighted average cost of capital of 6.5 percent. The company's cost of equity is 12 percent, and its pretax cost of debt is 3.8 percent. The tax rate is 25 percent. What is the company's target debt-equity ratio?
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