Urban Development Corp. is considering two construction projects. The company’s required rate of return is 13%. Use appropriate factors from the tables provided.

• Project East: Initial Investment: $800,000; Year 1: $300,000; Year 2: $350,000; Year 3: $400,000; Year 4: $150,000
• Project West: Initial Investment: $900,000; Year 1: $350,000; Year 2: $400,000; Year 3: $450,000; Year 4: $200,000
• a. Determine the payback period for each project. Based on the payback period, which project is preferred?
• b. Determine the net present value for each project. Based on the net present value, which project is preferred?