Black Sheep Broadcasting Company is considering Implementing a project that is identical to that being evaluated by Green Penguin-aithough Biock Sheep wants to finance the $600,000.00 in additional assets using 50% equity and 50% debt capital. The interest rate an Eiack Sheep's new debt is expected to be 13%, and the project is forecasted to generate an EBIT of $140,000. As a result, the project is expected to generate a ROE of Now assume that Biack Sheep finances the same project with 50% debt and 50% equity capital, but expects it to generate an E8rT of only 540,000 . Further assume that the company as a whole will generate a large, positive income this year, such that any loss generated by the project (with its resulting tax saving) will be offset by the company's other (positive) income. Remember, the interest rate on Biack 5 heep's debt is 13\%. Under these conditions, it is reasenabie to expect that Black Sheep will generate a ROE of: Given the RoE-related fndings above for both Green Fenguin and Black Sheep, answer the following question: * The use of financial leverage a firm's expected ROE, the probability of a large loss, and consequently the risk borne by the firm's stockholders. - The greater a firm's chance of bankruptcy, the its aptimal debt ratio will be. * manager is more likely to use debt in an effort to boost profits