Residual Distribution Policy

Harris Company must set its investment and dividend policies for the coming year. It has three independent projects from which to choose, each of which requires a $4 million investment. These projects have different levels of risk, and therefore different costs of capital. Their projected IRRs and costs of capital are as follows:

Project A:	Cost of capital =	15%;		IRR =	16%
Project B:	Cost of capital =	13%;		IRR =	11%
Project C:	Cost of capital =	8%;		IRR =	10%

Harris intends to maintain its 45% debt and 55% common equity capital structure, and its net income is expected to be $11,750,000. If Harris maintains its residual dividend policy (with all distributions in the form of dividends), what will its payout ratio be? Round your answer to two decimal places.

____%