7. Dow’s price per share on December 11, 2015 was $54.91 and DuPont’s was $74.55. Dow shares outstanding were 1.160 billion and DuPont’s outstanding shares were 0.876 billion. Assume anticipated annual cost synergies are

$3.0 billion in perpetuity and that DowDuPont’s cost of capital is 10%. What is DowDuPont’s total market cap excluding synergy? What is the market cap including synergy using the zero growth method of valuation (see Chapter 7)?