The Nelson Company is considering twomutually exclusiveprojects. The projected cash flows are as follows:

Year Cash Flow A Cash Flow B

0 -$280,000 -$250,000

1 $60,500 $50,000

2 $75,000 $35,000

3 $80,000 $70,000

4 $95,000 $150,000

a. The company uses a discount rate of 8%. Should the company go ahead with either project? Why or why not?

b. If the company's discount rate is 4.5%, should it go ahead with either project and if so which is the better one?

NB: Please show detailed calculations and explanations for part a & b.