The capital budgeting director of Sparr Corporation is evaluating a project which costs $280,000, is expected to last for 10 years and produce after-tax cash flows, including depreciation, of $42,500 per year. As soon as the project ends, we will sell the materials for scrape for an after-tax cash flows $60,000. The firm's cost of capital is 13 percent. Which of the following answers is most correct?

options:

C The IRR is less than 5%, and we should accept the project.

r: The IRR is less than 5%, and we should reject the project.

r The IRR is between 5% and 15%, and we should accept the project.

r- The IRR is between 5% and 15%, and we should reject the project.

r: The IRR is more than 15%, and we should accept the project.

r: The IRR is more than 15%, and we should reject the project.