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4-16 RETURN ON EQUITY Commonwealth Construction (CC) needs $3 million of assets to get started, and it expects to have a basic earning power ratio of 35%. CC will own no securities, all of its income will be operating income. If it so chooses, CC can finance up to 30% of its assets with debt, which will have an 8% interest rate. If it chooses to use debt, the firm will finance using only debt and common equity, so no pre- ferred stock will be used. Assuming a 25% tax rate on taxable income, what is the difference between CC's expected ROE if it finances these as- sets with 30% debt versus its expected ROE if it finances these assets en- tirely with common stock