**Please solve using Excel and show formulas.**

The Titanic Shipbuilding Company has a non-cancelable contract to build a small cargo vessel. Construction involves a cash outlay of $259,000 at the end of each of the next two years. At the end of the third and fourth years, the company will receive payments of $300,000. Assume the IRR of this option exceeds the cost of capital.

The company can speed up construction by working an extra shift. In this case there will be a cash outlay of $565,000 at the end of the first year followed by a cash payment of $635,000 at the end of the second year.

Question: Use the IRR rule to show the (approximate) opportunity costs of capital at which the company should not work the extra shift.

Multiple Choice

A. The company should not work the extra shift if the opportunity costs of capital is less than 7.05%

B. The company should not work the extra shift if the opportunity costs of capital is less than 5.88%

C. The company should not work the extra shift if the opportunity costs of capital is less than 12.39%

D. The company should not work the extra shift if the opportunity costs of capital is less than 2.11%

E. The company should not work the extra shift if the opportunity costs of capital is less than 1.84%