Bailey, Bailey and Bailey Ltd. is an investment company that is considering investing in one of the following four investment projects: The latest balance sheet for the company shows: The company's bank has advised that the interest rate on any new debt finance provided for the projects would be 9.5% p.a. The company's preference shares currently sell for $7.50, and to induce investors to take up a new offering of preference shares the company would have to set the issue price at a discount of 4% off the present market price. The company's existing ordinary shares sell for $2.50 each and management has disclosed that it expects to pay a dividend of 21 cents per share at the end of the next year. Historically, dividends have increased at an annual rate of 7% p.a. and are expected to continue to do so in the future. The ordinary equity component to finance new projects will require new shares to be sold at a 6% discount from the current $2.50 price, and the costs for undertaking the new issue are estimated to be 15 cents per share. The company's tax rate is 30%. (a) Determine the market value proportions of debt, preference shares and ordinary equity comprising the company's capital structure. (b) Calculate the after-tax costs of capital for each source of finance. (c) Determine the after-tax weighted average cost of capital for the company. (d) Under what conditions can the firm's weighted average cost of capital be used for assessing new projects? (e) Replicate (a) to (c) using an Excel spreadsheet(s). Note, there is no need to submit your excel spreadsheets. This question makes you replicate your previous calculations in an Excel setting. Hence, the majority can be simply cut and pasted straight from Excel. The identification of the cells and the formula that you have used to get the answer needs to be highlighted in the excel (f) Determine which investments, A, B, C or D, should be made. Assume no capital rationing