The mini case starts on page 417 in the textbook.

Read the case carefully, including Figure 13.2 (Mr. Brinepool's cost of capital memo), and contemplate Sea Shore's balance sheet (Table 13.6). Based on the information given, place yourself in Ms. Mountaindog's position and analyze the calculations made by Mr. Brinepool. Do you agree with his conclusions regarding the WACC of Sea Shore Salt? If not, why? Show your calculations and explain your reasoning.

Hint: recall that appropriate rates of return for cost of capital calculations are the rates of return that investors can earn on comparable risk investments in the capital market.