Firm U wants to start a project with cash flows, after one year, equal to 190, 105, 20 with equal probability, and an initial investment of 100. The outcome of the project does not depend on the state of the economy and the risk-free rate is 5%. Firm U asks for a loan to pay the initial investment. The firm will suffer a financial distress cost of 20 if it cannot honor completely the payment to the lender. What would be the interest rate of this loan? Choose the closest alternative from below.

A There is no interest rate to finance the project.

B 110%

C 5%

D 21%