firms HL, and LL. are identical except for their financial leverage rabios and the interest rates they pay on debt. Each has $14 million in invented capital, has 12.1 million of EBIT, and sin the 25% federai-plus-state tax bracket. Firm HL, bowever, has a debt-to-capital rato of 55% and pays 12% Intereat on its debt, whereas 4 has a 40% debt-to-Capital ratio and 10% interest on its debt. Neither firm uses preferred stock in its capital structure. a. Criculate the return on lovested capital (hoic) for each firm. Pound your answers to two decimal places. RotC for firm L. rosc for firm HL: b. Calciate the rate of rvturn on equity (not) for atch firm, Round your answers to tho decimal places. Bof for firm LL Rot for fiem HuL C. Observing that HiL has a higher RoE. L's treaturer is thinking of naising the sebt-to-capilai rabo from 40% to 60% even though that would increase uls interest rate an al dete ta 157k. Calculate the new poe for 4 . faund your answer to two dedimal places