Problem 7-7 Calculating IRR

Schaueffle Machines, Inc., has a project with the following cash flows. The company evaluates all projects by applying the IRR rule.

Year. Cash Flow

0 $28,500

1 12,500

2 15,500

3 11,500

a.	What is the IRR for this project? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
b.	If the appropriate interest rate is 13 percent, should the company accept the project?