You work for an outdoor play structure manufacturing company and are trying to decide between the following two projects:

	Year-End Cash Flows ($ thousands)
Project	0	1	2	IRR
Playhouse (minor project)	27	18	22	29.6%
Fort (major poject)	76	38	50	9.9%

You can undertake only one project. If your cost of capital is

7%,

use the incremental IRR rule to make the correct decision.

The incremental IRR is

??%.

(Round to two decimal places.)