Big Retailer (BR) follows a moderate current asset investment policy, but is now considering a change, perhaps to a restricted or maybe to a relaxed policy. BR’s annual sales are $1,400,000; its fixed...

Big Retailer (BR) follows a moderate current asset investment policy, but is now considering a change, perhaps to a restricted or maybe to a relaxed policy.  BR’s annual sales are $1,400,000; its fixed assets are $950,000; its target capital structure calls for 40% debt and 60% equity; its EBIT is $600,000; the interest rate on debt is 8%; and its tax rate is 20%.  With a restricted policy, current assets will be 20% of sales, while under a relaxed policy, current assets will be 35% of sales.  What is thedifference in the projected ROEs between the restricted and relaxed policies?