Wyatt Oil Is Considering Drilling a New Self-Sustaining Oil Well

Multiple Choice

Wyatt Oil is considering drilling a new self-sustaining oil well at a cost of $1,000,000.This well will produce $100,000 worth of oil during the first year,but as oil is removed from the well the amount of oil produced will decline by 2%,per year forever.If Wyatt Oil's appropriate interest rate is 8%,then the NPV of this oil well is closest to:

A) -$250,000.
B) $0.
C) $250,000.
D) $1,000,000.