$3.$ Dan is considering whether to issue coupon$-$bearing bonds or zero$-$coupon bonds. The YTM $($yield to maturity$)$ on either bond issue will be $5\mathrm{.}5\%.$ The coupon bond would have a $5\mathrm{.}5\%$ coupon rate and coupon is paid semi$-$annually. Assume the company$$s tax rate is $21\%,$ and interest is compounded every $6$ months.

a$.$ How many of the coupon bonds must East Coast Yachts issue to raise the $$45$ million? In $30$ years, what will be the principal repayment due if East Coast Yachts issues the coupon bonds?

b$.$ How do the answers in $($a$)$ change if only using zeroes $($i$.$e$.,$ zero$-$coupon bonds$)$ as the source of financing?

c$.$ Would you recommend a zero coupon issue or a regular coupon issue, why?