Options: 2.28 years 2.85 years 2.89 years 3.40 years

Wright Corp. is considering the purchase of a new piece of equipment, which would have an initial cost of $1,000,000 and a 5-year life. There is no salvage value for the equipment. The increase in cash flow each year of the equipment's life would be as follows: Year 1 $ 386, 000 Year 2 $ 361 , 000 Year 3 $ 296 , 000 Year 4 $ 241 , 000 Year 5 $ 196 , 000 What is the payback period? Multiple Choice 2.28 years O 2.85 years