4. Franchising, Inc. is considering a major investment. The investment will have an initial cost of $800,000. The cash inflows generated by the project are estimated at $150,000 for the first three years and $100,000 for the following 5 years. What is the internal rate of return? (Hint: It may be easier to find the correct answer by trial and error, especially if you do not have a financial calculator.) a. 4.40 percent b. 4.51 percent C. 4.62 percent d. 4.73 percent e. 4.85 percent 5. Chester's has a proposed project that will generate sales of 4,000 units at a selling price of $56 each. The fixed costs are $35,000 and the variable costs per unit are $31. The project requires $50,000 of fixed assets that will be depreciated on a straight-line basis to a zero book value over the 5-year life of the project. The salvage value of the fixed assets is $14,000 and the tax rate is 25 percent. What is the after- tax cash flow for the final year? a. $61,050 b. $61,550 c. $61,750 d. $62,250 e. $62,875