The capital budgeting director of Sparrow Corporation is

evaluating a project which costs $200,000, is expected to

last for 10 years and produce net aftertax

cash flows of

$44,503 per year. If the firm's cost of capital is 14

percent, what is the project's IRR? (Hint: Is the firm's cost

of capital relevant to an IRR calculation? )

8%

14%

18%

5%

12%