Suppose Amazon.com is considering investing in warehouse-management software that costs \(\$ 500,000\), has \(\$ 50,000\) residual value, and should lead to cost savings of \(\$ 120,000\) per year for its five-year life. In calculating the ARR, which of the following figures should be used as the equation's denominator?

a. \(\$ 225,000\)

b. \(\$ 500,000\)

c. \(\$ 250,000\)

d. \(\$ 275,000\)