You are trying to determine which of two projects to undertake. Both projects have an initial outlay of $2,000. However, Project Y provides an after-tax cash flow of $1,000 each year for three years, while Project Z provides an after-tax cash flow of $600 each year for six years. The required rate of return for both projects is 10 percent. Therefore, Project Y has an NPV of $486.85 and an IRR of 23.38 percent, and Project Z has an NPV of $613.16 and an IRR of 19.91.

The equivalent annual annuity for Project Y is:

a) $195.76.

b) $162.28.

c) $186.85.

d) $111.79.