You are given the following information concerning a firm Assets required for operation: $6,000,000 Revenues: $8,000,000 Operating expenses: $7,150,000 Income tax rate: 40% Management faces three possible combinations of financing: 1. 100% equity financing 2. 25% debt financing with a 8% interest rate 3. 50% debt financing with a 8% interest rate 1. What is the net income for each combination of debt and equity financing Round your answers to the nearest dollar 1 2 3 Net income 13 $ . What is the return on equity for each combination of debt and equity financing? Round your answers to one decimal place, What is the net income for each combination of debt and equity financing Round your answers to the nearest dollar 2 3 Net income $ $ b. What is the return on equity for each combination ot debt and equity financing? Round your answers to one decimal place, Return on equity the interest rate had been 16 percent intend of 8 percent, what would be the retum nequly for each combination of debt and our hearing Round you to ce decal Olace Beton 6. What is the implication of the use of financial leverage when werest rates ange? The use of ancial leven is likely to let the return to the con stockholders the rate of interests low. It the rate of interest exceeds after adjusting for taves the returnement on the borrowed funds, the return to the common stockholderis hy tot by the use of financial leverage