A&B Enterprises is trying to select the best investment from two alternatives. Cash flows for each alternative are:

Initial outlay $ 106,000 $ 106,000

Year Investment A Investment B

1 $9,000 $56,000

2 $24,000 $51,000

3 $29,000 $35,000

4 $68,000 0

5 $69,000 0

For each of the investments, calculate the following (use a 10% discount rate):

(a) Payback period

(b) Internal rate of return

(c) For each method individually, which is the better investment?