Choosing between two projects with acceptable payback periodsShell Camping Gear, Inc., is considering two mutually exclusive projects. Each requires an initial investment of $. John Shell, president of the company, has set a maximum payback period of 4 years. The after-tax cash inflows associated with each project are shown in the following.

Year 1

$20,000 Project A

$50,000 Project B

Year 2

$30,000 Project A

$40,000 Project B

Year 3

$40,000 Project A

$30,000 Project B

Year 4

$50,000 Project A

$20,000 Project B

Year 5

$20,000 Project A

$20,000 Project B

a.Determine the payback period of each project. b.Because they are mutually exclusive, Shell must choose one. Which should the company invest in?