The Argyll corporation wants to set up a private cemetery business. The cemetery project will provide a net cash inflow of $97,000 for the firm during the first year, and the cash flows are projected to grow at a rate of 4% per year, forever. The project requires an initial investment of $1,500,000. Argyll requires an 11% return on such an undertaking.

a) Estimate the present value of inflows

b) Compute the NPV

c) Should the cemetery business be started?