The Titanic Shipbuilding Company has a noncancelable contract to build a small cargo vessel. Construction involves a cash outlay of $259,000 at the end of each of the next two years. At the end of the third and fourth years, the company will receive payments of $300,000. Assume the IRR of this option exceeds the cost of capital. The company can speed up construction by working an extra shift. In this case there will be a cash outlay of $565,000 at the end of the first year followed by a cash payment of $635,000 at the end of the second year.

Question: Use the IRR rule to show the (approximate) opportunity costs of capital at which the company should not work the extra shift. (Enter your answers as a percent rounded to 2 decimal places. Enter the smallest percent first.)

A - the company should not work the extra shift if the opportunity costs of capital is less than 2.11%

B - the company should not work the extra shift if the opportunity costs of capital is less than 7.05%

C - the company should not work the extra shift if the opportunity costs of capital is less than 12.39%

D - the company should not work the extra shift if the opportunity costs of capital is less than 5.88%

E - the company should not work the extra shift if the opportunity costs of capital is less than 1.84%