What is the payback reciprocal

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Problem 1: PP Company plans to acquire a computer costing P20,000 with a salvage value of P8,000 at the end of its 3-year life. Annual cash savings before taxes are P10,000. Income taxes are 40% each year. What is the payback reciprocal?

Option 1: 3.80%

Option 2: 38%

Option 3: 32%

Option 4: 2.60%

Reference no: EM132818307

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