Webster Company has compiled the following information shown in the following table below.

Source of capital	Book Value	Market Value	Cost of Financing
Long Term Debt	$4,200	$3,800	10%
Preferred Equity	$100	$150	10%
Common Equity	$1,200	$22,450	15%
Total Value	$4,500	$6,400

The Tax rate is 30%

Required:

A) Calculate the weighted average cost of capital using the book value.

B) Calculate the weighted average cost of capital using the market value.

C) What inference can you make based on answers A and B ?