XYZ Inc. is analyzing two potential projects. Project 1 requires an initial outlay of $45,000 and will generate cash inflows of $20,000, $25,000, and $30,000 at the end of each of the next three years. Project 2 requires an initial outlay of $60,000 and will generate cash inflows of $22,000, $28,000, and $36,000 at the end of the next three years. The discount rate for both projects is 11%. Compute the NPV for both projects and advise which project to accept.

Requirements:

1. Calculate the NPV for Project 1.
2. Calculate the NPV for Project 2.
3. Recommend which project to accept based on NPV.