Future Health Corp is evaluating two potential projects with the following net cash flows. The company's required rate of return on investments is 8%. (PV of $1, FV of $1, PVA of $1, and FVA of $1).

Year	Project Omega	Project Sigma
0	$(400,000)	$(350,000)
1	$100,000	$90,000
2	$150,000	$120,000
3	$200,000	$160,000
4	$250,000	$220,000

a. Calculate the payback period for each project. Which project is preferred based on the payback period?

b. Calculate the net present value for each project. Which project is preferred based on the net present value?