Inc., is considering a project that would have a ten-year life and would require a $1,000,000 investment in equipment. At the end of seven years, the project would terminate and the equipment would have no salvage value. The project would provide net operating income each year as follows (Ignore income taxes.):

Sales	$2,000,000
Variable expenses	1,400,000
Contribution margin	600,000
Fixed out-of-pocket cash expenses	400,000
Depreciation	100,000
Net operating income	$100,000

All of the above items, except for depreciation, represent cash flows. The company's required rate of return is 15%.

A) Compute the project's payback period, in years

B) Compute the project's simple rate of return.