cash flows are expected to last forever

36.You are considering opening a new plant. The plant will cost $100.3 million upfront. After that, it is expected to produce profits of $31.9 million at the end of every year. The cash flows are expected to last forever. Use the IRR to determine the maximum deviation allowable in the cost of capital estimate to make the investment.

The maximum deviation allowable in the cost of capital is 28.65%.

The maximum deviation allowable in the cost of capital is 21.60%.

The maximum deviation allowable in the cost of capital is 24.70%.

The maximum deviation allowable in the cost of capital is 18.45%.