Geared cost of equity

Hi. These two questions have the same requirement but have two different workings. I understand the first working, but I’m confused as to why the used a completely different working in the second question for the same requirement. This is from the Study Hub.

1. Colt Co has an equity beta factor of 1.15 and an asset beta factor of 0.85. The risk-free rate of return is 8.5% and the market return is estimated at 12.4%. The corporate tax rate is 25%.

What is Colt’s geared cost of equity?

WORKING

The cost of equity geared is using the equity beta in CAPM (i.e. 8.5% + 1.15(12.4% – 8.5%) = 12.985%)

2. A company’s equity beta is 1.10 and its asset beta is 0.85. The market premium is 4.50% and the risk-free rate 3%

What is the company’s geared cost of equity?

A.4.3%
B.4.65%
C.6.8%
D.7.95%

WORKING

Using CAPM, the cost of equity geared = Risk-free rate + (market premium × equity beta) = 3% + (4.50 × 1.10) = 7.95%