The Hokie Corporation is considering two mutually exclusive projects. Both require an initial outlay of $13,000 and will operate for 7 years. Project A will produce expected cash flows of $8,000 per year for years 1 through 7, whereas project B will produce expected cash flows of $9,000 per year for years 1 through 7. Because project B is the riskier of the two projects, the management of Hokie Corporation has decided to apply a required rate of return of 16 percent to its evaluation but only a required rate of return 11 percent to project A. Determine each project's risk-adjusted net present value.

What is the risk-adjusted NPV of project A?

What is the risk-adjusted NPV of project B?