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A small accounting firm is considering the purchase of a computer software package that would greatly reduce the amount of time needed to prepare tax

A small accounting firm is considering the purchase of a computer software package that would greatly reduce the amount of time needed to prepare tax forms. The software costs $2050 and this expense will be incurred immediately. The firm estimates that it will save $725 of cash flow at the end of each year beginning in one year for 7 consecutive years, and also save $1994 in year 8. What is the payback on the computer package?

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