7.XYZ Company is evaluating two projects of constructing two different luxury apartments in two towns in the state of Selangor. The initial investments for both these projects are $160,000. The required rate of return for this project is 10%. The following is the estimated annual cash flow for the first 6 years.

Year Project Alpha($) Project Beta($)

1 40,000 30,000

2 40,000 35,000

3 40,000 35,000

4 40,000 30,000

5 40,000 40,000

6 40,000 51,000

Based on the above information, you are required to make an analysis for the decision on capital budgeting of two projects based on these techniques:

A. Payback period

B. Net present value