A piece of laborsaving equipment has just come onto the market that Mitsui Electronics, Ltd., could use to reduce costs in one of its plants in Japan. Relevant data relating to the equipment follow:

Purchase cost of the equipment

$

640,500

Annual cost savings that will be provided by the equipment

$

105,000

Life of the equipment

10 years

Required:

1-a.	Compute the payback period for the equipment. Investment Required -