Blue Pencil Publishing is evaluating a proposed capital budgeting project (project Deita) that wili require an initialinvestment of $1,450,000. Blue Pencil Publishing has been basing capital budgeting decinions on a project's NPV; however, its new CFO wants to start using the IRR method for copital budgeting decisions, The CFO says that the IRR is a better method because percentages and returns are easier to understand and to compsre to required returns. Blue Fencir Publishing's WACC is 9%, and project Delta has the same risk as the firm s overage project. The project is expected to generate the following net cash flows: Which of the following is the correct calculation of project Delta's iRe? 437 4.88% 5.91% If this is an independant project, the Ifr method states that the firm should