Nagle's Machinery is spending $97,500 to update its equipment. This is necessary if the firm wishes to be competitive in the marketplace and provide a wide array of product models. The company estimates that these updates will improve their cash inflows by $18,500 a year for 5 years. What is the payback period?

A.

1.37 years

B.

2.84 years

C.

3.29 years

D.

5.49 years

E.

This project never pays back.