Black Tiger Homebuilders is considering investing in a one-year project that requires an initial investment of $475,000. To do so, it will have to issue new common stock and will incur a flotation cost of 2.00%. At the end of the year, the project is expected to produce a cash inflow of $595,000. The rate of return that Black Tiger expects to earn on its project (net of its flotation costs) is?

you have to find out what is the total cost and compare the total cost (cash outflows) with the total cash inflows, and then you can calculate the return,