A company is considering the purchase of a new piece of equipment that costs $51,000 and will have a salvage value of $5,100 after 9 years. Using the new piece of equipment will increase annual cash flows by $6,100. What is the payback period for the new piece of equipment?

Suppose that the increase in cash flows was $10,100 in the first year, then decreased by $1,000 each year over the life of the equipment.

Options:
a) 7.5 years
b) 6.5 years
c) 5.5 years
d) 4.5 years