JKL Corp is assessing two mutually exclusive projects, Project 1 and Project 2. Both require an initial investment of USD 80,000. The cash flows for these projects are as follows:

Year	Cash flows (Project 1)	Cash flows (Project 2)
(Initial Investment)	(80,000)	(80,000)
1	25,000	20,000
2	30,000	25,000
3	20,000	30,000
4	10,000	20,000

a. Calculate the payback period for Project 1 and Project 2.

b. Assuming JKL Corp’s payback period threshold is 3 years, which project should be selected? Support your decision.