The Internal rate of return (TRR) refers to the compound annual rate of retum that a project generates based on its up-front cost and subsequent cash Hows. Consider the case of Blue Llama Mining Company: Blue Llama Mining Company is evaluating a proposed capital budgeting project (project Sigma) that will require an initial investment of $900,000 Blue Liama Mining Company has been basing capital budgeting decisions on a project's NPV; however, its new CFO wants to start using the IRR method for capital budgeting decisions. The CFO says that the IRR is a better method because returns in percentage formare easier to understand and compare to required returns, Blue Llama Mining Company's WACC is 9%, and project Sigma has the same risk as the firm's average project The project is expected to generate the following net cash flows: Year Cash Flow Year 1 $300,000 Year 2 $425,000 Year $475,000 Year 4 $450,000 Which of the following is the correct calculation of project Sigma TRA? 28.639 21.02 2454 If this is an independent project, the IRR method states that the firm should If the projets cost of capital were to increasie, how would that affect the 1887 The would decrease The IRR would not change The would increase