Splendid Tea Company obtains its capital from debt and equity. The interest rate on Splendid Teas $6 million debt is 8 per cent per annum, and the company pays 25 per cent income tax. The cost of Splendid Teas equity capital is 12 per cent, and the market value of the equity is $14 million. The weighted average cost of capital for Splendid Tea Company is: Select one:

a. 12.5% b. 8.52% c. 12% d. 10.2%