Which of the following comes closest to the net present value (NPV) of a project whose initial investment is $5 and which produces two cash flows: the first at the end of year 2 of $3 and the second at the end of year 4 of $7? The required rate of return is 12%?

a. $1.64

b. $1.84

c. $2.05

d. $2.26

e. $0