Project A has an initial outlay of $65,000. The project will generate the following cash inflows: $7,500 in one year, $8,000 in 2 years and $9,000 each year from the end of year 3 to the end of year 14 inclusive. The cost of capital is 10% p.a. effective.

i. Calculate the net present value (NPV) for Project A. (3 marks)

ii. Project B has a net present value of -$200. If Project A and Project B are mutually exclusive projects, which project should be accepted? Provide your reasons. (2 marks)