Consider the comprehensive example involving Burlington Resources (Table 16.5). In this example, it was assumed that forecasted sales and expected EBIT, as well as the interest rates on short-term and long-term debt, were independent of the firms working capital investment and financing policies. However, these assumptions are not always completely realistic in practice. Sales and EBIT are generally a function of the firms inventory and receivables policies. Both of these policies, in turn, affect the firms level of investment in working capital. Likewise, the interest rates on short-term and long-term debt are normally a function of the riskiness of the firms debt as perceived by lenders and, hence, are affected by the firms working capital investment and financing decisions.

	Forecasted Sales		Expected EBIT
	(in Millions		(in Millions		Interest Rate
Policy	of Dollars)		of Dollars)		STD (%)		LTD (%)
Aggressive	$98		$9.8		8.5		9.5
Moderate	99		9.9		8.0		8.1
Conservative	100		10.0		7.5		6.7

Recompute Burlingtons rate of return on common equity under the set of assumptions concerning sales, EBIT, and interest rates for each of the three different working capital investment and financing policies provided in the table above. Round your answers to two decimal places.

	Policy
	Aggressive	Moderate	Conservative
Expected Rate of Return on Common Equity	%	%	%