Grey Fox Aviation Company is analyzing a project that requires an initial investment of $2,500,000. The projects expected cash flows are:

Year	Cash Flow
Year 1	$375,000
Year 2	200,000
Year 3	500,000
Year 4	450,000

Grey Fox Aviation Companys WACC is 8%, and the project has the same risk as the firms average project. Calculate this projects modified internal rate of return (MIRR):

21.47%

-13.98%

19.08%

25.04%

If Grey Fox Aviation Companys managers select projects based on the MIRR criterion, they should (Accept/Reject) this independent project.

Which of the following statements about the relationship between the IRR and the MIRR is correct?

A typical firms IRR will be less than its MIRR.

A typical firms IRR will be equal to its MIRR.

A typical firms IRR will be greater than its MIRR.