XYZ Corporation is evaluating a new project that has an initial investment of $1 million. The project is expected to generate cash inflows of $300,000 annually for five years. After year five, the project is expected to have a salvage value of $200,000. XYZ Corporation uses a discount rate of 10% for its capital budgeting projects.
As part of the evaluation, the company wants to determine the net present value (NPV) and the internal rate of return (IRR) for this project. Given these parameters, what is likely to be true about the IRR of the project compared to the company's discount rate of 10%?