Consider the following case of Lost Pigeon Aviation: Suppose Lost Pigeon Aviation is considering a project that will require $350,000 in assets. . . The project is expected to produce earnings before interest and taxes (EBIT) of $40,000. Common equity outstanding will be 15,000 shares. The company incurs a tax rate of 40%. . If the project is financed using 100% equity capital, then Lost Pigeon Aviation's return on equity (ROE) on the project will be . In addition, Lost Pigeon's earnings per share (EPS) will be Alternatively, Lost Pigeon Aviation's CFO is also considering financing the project with 50% debt and 50% equity capital. The interest rate on the company's debt will be 11%. Because the company will finance only 50% of the project with equity, it will have only 7,500 shares outstanding. Lost Pigeon Aviation's ROE and the company's EPS will be if management decides to finance the project with 50% debt and 50% equity. Typically, using financial leverage will a project's expected ROE