Suppose your firm is considering investing in a project with the cash flows shown as follows, that the required rate of return on projects of this risk class is 10 percent, and that the maximum allowable payback and discounted payback statistics for the project are three and a half and four and a half years, respectively. Use the IRR decision to evaluate this project; should it be accepted or rejected?

Time 0 1 2 3 4 5 6 Cash flow($s) -85000 12000 11000 13000 21000 31000 32000

Group of answer choices

IRR = 16.92 percent; accept the project

IRR = 7.123 percent; reject the project

IRR = 8.81 percent; reject the project

IRR = 10.59 percent; accept the project