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Below are the expected after-tax cash flows for Projects Y and Z. Both projects have an initial cash outlay of $20,000 and a required rate of return of 17%.

	Project Y	Project Z
Year 1	$12,000	$10,000
Year 2	$8,000	$10,000
Year 3	$6,000	0
Year 4	$2,000	0
Year 5	$2,000	0

Project Y's IRR is:

1.

12.51%

2.

less than zero.

3.

22.51%.

4.

less than 17%.