Below are the expected after-tax cash flows for Projects Y and Z. Both projects have an initial cash outlay of $20,000 and a required rate of return of 17%.

	Project Y	Project Z
Year 1	$12,000	$10,000
Year 2	$8,000	$10,000
Year 3	$6,000	0
Year 4	$2,000	0
Year 5	$2,000	0

Project Y's IRR is:

	1.	12.51%
	2.	less than zero.
	3.	22.51%.
	4.	less than 17%