Urban Developments is evaluating two new projects with the following net cash flows. The company's required rate of return on investments is 15%. (PV of $1, FV of $1, PVA of $1, and FVA of $1).

Year	Project UrbanOne	Project UrbanTwo
0	$(600,000)	$(500,000)
1	$160,000	$140,000
2	$200,000	$180,000
3	$240,000	$220,000
4	$280,000	$260,000

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

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