Firms HL and LL are identical except for the leverage at emots. Each has $20 million in assets, SA million of the man has a debt ratio DIA of 50% and pass 12 inties ontstelt, 15 pays only 10% interest on its Gebr. A Calculate the return on equity ROE) for each im 8. Observing that HL has a highet ROE 'stress stinking ang is the 60%, even though that would increase Li's interest rate on al deb o'x. batte ROEPEL Eda View Insent Format Tooh Table DV Paragua Maps an Question 11 Firms HL and LL are identical except for their leverage ratios and the Interest rates they pay on dett Each has $20 million in assets, $4 million of EBIT, and has a 40% Income tax rate. Fum HL, however, has a debt ratio (D/A) of 50% and pays 12% Interest on its debt, whereas LL has a 30% debt ratio and pays only 10% Interest on its debt. A Calculate the return on equity (ROE) for each firm. B. Observing that HL has a higher ROE, LL's treasurer is thinking of raising its debt ratio from 30% to 60%, even though that would increase Ll's interest rate on all debt to 15%. Calculate the new ROE for LL Edit View Insert Format Tools Table 12pt Paragraph B. I Ave Tv