Suppose That an Industrial Building Can Be Purchased Today for $2,500,000

Multiple Choice

Suppose that an industrial building can be purchased today for $2,500,000. If it is expected to produce cash flows of $180,000 for each of the next five years (assume CFs are received at the end of each year) and can be sold at the end of the fifth year for $2,800,000, what is the internal rate of return (IRR) on this investment?

A) 0.09%
B) 4.57%
C) 9.20%
D) 10.37%