Here is the following scenario for a 1 year investment:

Purchase stock: $101

Equity invested: $73

Debt: $27

Interest Rate: 10%

Sales price after 1 year: $157

1. What is the leverage ratio? in calculations.( preferably on paper and clear handwriting so I can understand )

2.What is the rate of return for the year? in calculations.( preferably on paper and clear handwriting so I can understand )

3. If the leverage ratio were to increase would the rate of return for the year increase or decrease? Explain from a mathematical or arithmetical view why this is the case?