Ang Lee TCM intends to build a new TCM manufacturing plant at a cost of $4.4 million in 2020. It is considering one of the following ways to fund this new plant by issuing: common shares, preference shares and / or bonds.

a) Calculate the number of new preferred shares that the firm will have to issue if it is willing to pay an annual dividend of $4.80 on each preference share. Assume that investors expect 6% annual rate of return on the preference share.

b) The company previously paid a dividend per share (D0) of $3.30 per common share in 2019. The management projects that the dividend will grow at a rate of 6% per annum in the long-term. Investors expect 13% annual rate of return on their investments.

i. Determine the current fair value per common share (round to the nearest dollar).

ii. Calculate the number of new common shares that the company will have to issue in 2020 at the current share price to finance the cost of the new plant.

c) Bangbang Chinese Herbs is a competitor of Ang Lee TCM. Bangbangs EPS is $10.40 and average share price is $49.92. Ang Lee's EPS is $12.12 and PE is 5.9. Calculate Bangbangs price-earnings (PE) ratio.

d) Ang Lee TCM is using bonds to raise the $4.4 million. Determine the coupon rate the bond has to offer investors given the following information:

Par value of each bond: $250,000

Current price of comparable bond: $241,274

Time to maturity: 15 years

Required return on bonds of similar risk: 8% per annum