An investment of $200,000 is expected to generate the following cash inflows in six years:

Year 1: $70,000 Year 2: $60,000 Year 3: $55,000 Year 4: $40,000 Year 5: $30,000 Year 6: $25,000

Required: Compute payback period of the investment.

a. 3.375 years

b. 3.275 years

c. 3.475 years

d. 3.575 years