Liberty Services is now at the end of the final year of a project. The equipment was purchased prior to the new tax law and originally cost $18,000, of which 75% has been depreciated. The firm can sell the used equipment today for $7,500, and its tax rate is 25%. What is the equipments after-tax salvage value for use in a capital budgeting analysis? Note that if the equipment's final market value is less than its book value, the firm will receive a tax credit as a result of the sale that will offset expenses from the companys other projects.

a. $7,500

b. $5,250

c. $6,750

d. $8,250

e. $5,625