Blue Spruce Company is considering two capital investment proposals. Estimates regarding each project are provided below: Project Soup Project Nuts
Initial investment $600000 $800000
Annual net income 56000 46000
Net annual cash inflow 180000 195000
Estimated useful life 5 years 6 years
Salvage value 0 0

The company requires a 10% rate of return on all new investments.

Present Value of an Annuity of 1
Periods 9% 10% 11% 12%
5 3.89 3.791 3.696 3.605
6 4.486 4.355 4.231 4.111

The internal rate of return for Project Nuts is approximately:

a. 11%.
b. 10%.
c 9%.
d. 12%.