Fuzzy Badger Transport Company is evaluating a proposed capital budgeting project (project Delta) that will require an initial investment of $1, 600,000. Fuzzy Badger Transport Company has been basing capital budgeting decisions on a project's NPV; however, its new CFO wants to start using the IRR method for capital budgeting decisions. The CFO says that the IRR is a better method because percentages and returns are easier to understand and to compare to required returns. Fuzzy Badger Transport Company's WACC is 8%, and project Delta has the same risk as the firm's average project. The project is expected to generate the following net cash flows: Which of the following is the correct calculation of project Delta's IRR? 2.82% 3.52% 4.05% 4.22% If this is an independent project, the IRR method states that the firm should ____________. If the project's cost of capital were to increase, how would that affect the IRR? The IRR would increase. The IRR would not change. The IRR would decrease