Projects A and B, both of equal risk, are mutually exclusive alternatives for expanding Corporations capacity. The firms cost of capital is 13%. The cash flows for each project are shown in the following table.

Project A Project B

Year 0: ($80,000) Year 0: ($80,000)

Year 1: $15,000 Year 1: $15,000

Year 2: $20,000 Year 2: $15,000

Year 3: $25,000 Year 3: $15,000

Year 4: $30,000 Year 4: $35,000

Year 5: $30,000 Year 5: $25,000

A. What is each projects payback period? (4 points)

B. What is each projects net present value? (4 points)