Zenith Capital Ltd is evaluating a financing option for a ₦500,000,000 project using 60% debt at a pre-tax cost of 14% and 40% equity at a cost of 18%. The company's effective income tax rate is 30%. What is the Weighted Average Cost of Capital (WACC)?

The after-tax cost of debt = $14\% \times (1 - 0.30) = 9.8\%$. WACC = $(W_d \times K_d) + (W_e \times K_e) = (0.60 \times 9.8\%) + (0.40 \times 18\%) = 5.88\% + 7.20\% = 13.08\%$. Option B (15.60%) is a common error where the tax shield on debt is ignored: $(0.6 \times 14) + (0.4 \times 18) = 8.4 + 7.2 = 15.6\%$. Option A uses only the equity weight incorrectly, and D applies an incorrect tax adjustment. The correct answer is 13.08%.