Two projects A and B are to be evaluated economically where the MARR is 10%.

Project A: Initial investment is $228,000 where $158,000 is paid now and the remaining $70,000 is to be paid at year 2. Expected annual net revenues are $55,000. The salvage value is $30,000 at year 5.

Project B: Initial investment is $140,000 to be paid now. Expected annual net revenues are $26,000 for seven years.

Answer the following two questions:

1. Select the best project.
2. Compute the capital recovery for project A