Terrell Trucking Company is in the process of setting its target capital structure. The CFO believes that 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% |
$3.10 |
$32.75 |
| 30 |
3.45 |
35.75 |
| 40 |
3.75 |
36.00 |
| 50 |
3.55 |
32.25 |
Assuming that the firm uses only debt and common equity, what is Terrell's optimal capital structure? Round your answers to two decimal places.
% debt
% equity
At what debt-to-capital ratio is the company's WACC minimized? Round your answer to two decimal places.