Vacation Resorts Inc. $($VRI$)$ is interested in developing a new hotel in Spain. The company

estimates that the hotel would require an initial investment of $$32$ million. VRI expects that

the hotel will produce positive cash flows of $$5\mathrm{.}25$ million a year at the end of each of the

next $20$ years. The project's cost of capital is $14\%.$ The project's net present value today $($in

millions of dollars$)$ is $$2\mathrm{.}77.$ The internal rate of the return on this project must be

Equal to zero.

Less than zero.

Greater than $14\%.$

Less than $14\%.$

Between zero and $14\%.$