PSA10.10 Compare financing alternatives using return on ordinary shareholders' equity. LO10 Donkey Ltd's equity is as follows: $5000000 2000000 Share capital Retained earnings and reserves Equity $7000000 Donkey Ltd plans to expand its operations by establishing a branch in Thailand. The new branch will cost $3.5 million. Expected profit before tax and interest when the new branch is operational is $2.2 million. The tax rate is 30%. Donkey Ltd is considering two financing alternatives: I. Borrow $3.5 million at 8% interest. 2. Issue 100000 S35 shares. Required Which funding alternative yields the higher return on equity? What other factors should be considered