Assume you are starting a business with $1000$ shares outstanding. The business is projected to have $$80,000$ in income by year $3.$ The industry has an average P$/$E ratio of $20.$ A friend is considering investing $$50,000$ in your venture today and requires $35\%$ return on her investment annually.

a$.$ What is the $\%$ ownership acquired by your friend in return of her investment?

b$.$ How many shares to be issued to your friend?

c$.$ What is the price per share?

d$.$ Compute the pre$-$money and post$-$money value of the business.

e$.$ Assume you plan to get a second round of financing at the end of year $1$ worth another $$50,000.$ Compute the $\%$ ownership acquired by the second investor.

f$.$ What is the founder$$s new $\%$ ownership in the venture?

g$.$ What is the new total number of shares in the venture?