Repeat the cost of capital calculations in Figure 12.8, assuming market value weights instead of book value weights.

In figure 12.8

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$2,200 $1,000 $1,200 55% $1,000 $1,400 $1,800 Equity (book value) Debt (book and market value) Debt/assets (%) EBIT/assets (%) $1,000 $1,000 $1,000 44% kd (before-tax) kd (after-tax) 10.00% 6.50% 18.00% 10.20% 6.63% 19.00% 10.30% 6.70% 20.00% 1 1.70% 7.61% 24.00% EBIT $420 41 379 133 $246 $300 82 458 160 $297 Interest 140 Earnings before tax Tax @ 35% 105 $195 $1,083 100 $10.83 $1.95 5.56 18.00% 182 $338 $1,407 100 $14.07 S3.38 4.17 15.06% Earnings after tax Equity (market value) Shares (thousands) Price per share $1,297 100 $12.97 $2.46 5.26 15.47% $1,487 100 $14.87 $2.97 5.00 14.09% Earnings multiple (times) k (based on BV weights)