An investment of $600,000 results in an income of $200,000 per year for six years. Annual expenses are $40,000 initially, then decrease by $2000 each year beginning at the end of year two and continue decreasing through year six. Salvage value at the end of year six is $250,000. MARR =10%.

(a) Draw the cash flow diagram

(b) What is the simple payback period?

(c) What is the discounted payback?