The Yurdone Corporation wants to set up a private cemetery business. According to the CFO, Barry M. Deep, business is looking up. As a result, the cemetery project will provide a net cash inflow of $145,000 for the firm during the first year, and the cash flows are projected to grow at a rate of 4 percent per year forever. The project requires an initial investment of $1,900,000.

a. What is the projects NPV if the required return is 11%?

b. Should this project be accepted?

c. The company is somewhat unsure about the 4% growth rate assumption in its cash flow projection. At what constant rate of growth would the company just break even (in terms of NPV) if the required return is still 11%?