QUESTION 3 An Automotive Company is considering raising funds for a factory expansion. The fund requirement for the expansion is US $5,000,000,000. The following are some of the funding options: 1. Loan to Bank US $2,000,000,000 with an annual interest rate of 8.2%. Where this loan is paid annually only the interest. The principal will be paid in the next 5 years. 2. Issuance of 400,000 shares of common stock with a market value of US $10,000/ share (shares issued and sold at par value). Cost of capital from 10% shares 3. Sales of 5,000 bonds with a value of U\$ 500,000 per share. The bonds are sold at a market value of US\$ 480,000 per share. The term of the bond is 10 years. Effective annual yield 8% 4. Issuance of 9% noncumulative preferred stock with stated value and sold for US\$ 1,000,000,000. Companies are not allowed to use more than 2 sources of funding to meet investment needs for expansion. The tax rate rate is 25%. If there is an excess of loanable funds for investment, the company can save it in a bank with 5% interest. Provide the best funding alternative