1. How long is the payback period for an investment projects $25,000 to start, and generates $7,000 a year after-taxes for six years?
a. 3 years
b. 4 years
c. 2 years
d. 6 years
2. The tax savings from an expense item are $75,000 for a company that spends 25% of its income to taxes.
How much does the item cost before tax?
a. $250,000
b. $ 200,000
c. $150,000
d. $300,000