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The warehouse manager at Johnson Cor. is considering installing additional insulation in the warehouse. He estimates that the annual savings would be a reduction in

The warehouse manager at Johnson Cor. is considering installing additional insulation in the warehouse. He estimates that the annual savings would be a reduction in heating cost from the current $16,000 per year to approximately $12,000 per year. Johnson Corp. Desires to earn 12% ROI, and the cost of installing the insulation is expected to be $20,000. How many years does the warehouse have to run in order to justify the insulation project?

a. 5.55 years

b. 5.77 years

c. 5.99 years

d. 6.19 years

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