A new forklift truck will require an investment on $20,000 and is expected to have year-end market values and annual expensed as shown below. Assume the forlklift is depreciated a MACRS 3 year property class asset, the income tax rate is 40% and the after tax MARR is 6%/year. What is the economic life on an after tax basis? (Please show work in Excel, thank you!)

MV

Expenses

0

$20,000

---

1

$15,000

$2,000

2

$11,250

$3,000

3

$8,500

$4,620

4

$6,500

$8,000

5

$4,750

$12,000

	a.	2 years
	b.	3 years
	c.	4 years
	d.	5 years