WACC- Book weights and market weights

(there are three parts)

WACC-Book weights and market weights Webster Company has cornpled the information shown in the following table a. Calculate the weighted average cost of capital using book value weights b. Calculate the weighted average cost of capital using market vatue weights c. Compare the answers obtained in parts a and b. Explain the differences a. The firm's weighted average cost of capital using book value weights is \%. (Round to two decimal placesj) \begin{tabular}{lrcc} \hline Source of capital & Book value & Market value & After-tax cost \\ \hline Long-term debt & $4,000,000 & $4,120,000 & 7% \\ Preferred stock & 40,000 & 57,000 & 11% \\ Common stock equity & 1,060,000 & 3,583,000 & 16% \\ Totals & $5,100,000 & $7,760,000 & \\ \hline \end{tabular}