Suppose Your Firm Is Considering an Investment Project That Will

Suppose your firm is considering an investment project that will generate an expected return of 5%. The project costs $200,000. Suppose further that your firm has $200,000 of retained earnings. If the market interest rate is 10%, your firm should

A) loan the retained earnings out at 5%.
B) loan the retained earnings out at 10%.
C) loan the retained earnings out at 15%.
D) invest the $200,000 of retained earnings in the project.