At what debt ratio is the company wacc minimized

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Reference no: EM13284054

Jackson Trucking Company is in the process of setting its target capital structure. The CFO believes the optimal debt-to-capital ratio is somewhere between 20% and 50%, and her staff has compiled the following projections for EPS and the stock price at various debt levels:

Debt/Capital Ratio	Projected EPS	Projected Stock Price
20%	$3.30	$34.75
30	3.40	35.75
40	3.75	36.25
50	3.60	33.75

At what debt ratio is the company's WACC minimized? Round your answer to two decimal places.

Reference no: EM13284054

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