A 1-year project has an up-front cost (not including flotation costs) of $500 million. The project is expected to produce a positive cash flow of $600 million at the end of the year. Therefore the project's expected return is 20%. If instead, however, the project requires the company to raise $500 million of new equity with an estimated $20 million of flotation costs, what would be the project' expected return? Assume that the company includes the flotation costs as part of the project's up-front costs.

a. 15.4%

b. 17.3%

c. 18.5%

d. 19.1%

e. 20.0%