3. The following five parts are all based on the status quo of company BW. (1) Company BW has issued 5,000 zero-coupon bonds with a maturity value of $1,000 and a remaining maturity of 5 years. Current market price of those bonds is $566 and bond investors use a semiannual compound rate. Marginal corporate income tax rate is 20%, find the annual after-tax effective cost of debt. [5 points) (2) Company BW has issued 15,000 preferred stocks. The par value is $100, dividend rate is 7.5% (of par value), and dividend is paid semiannually. Market price is $79 a share. Find the annual effective cost of preferred stock. [4 points) (3) Company BW has 100,000 shares outstanding and the market price is $22 per share. BW has been making semiannual dividend payments and last payment was $0.21 per share. What is BW's annual effective cost of equity if investors think dividend payments in the future will increase by 9%? (5 points) (4) Find the overall (annual) cost of capital for BW (WACC), based on questions 3.13.3. (10 points) (5) Company BW has the following two investment opportunities (A and B). Which project is better, according to MIRR? [10 points) Which project is better, according to profitability index? [10 points) Net Cash Flows End of Year Project A Project B 0 -4,000 -5,500 1,500 3,500 2 3,000 2,800 3 2,500 1,900 1