What investment can be justified for the new surface

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Annual maintenance cost for a particular section of highway pavement are $2,500. The placement of a new surface would reduce the annual maintenance cost to $500 per year for the first three years and to $1,000 per year for the next 7 years. After 10 years the annual maintenance would again be $2,500. If maintenance costs are the only saving, what investment can be justified for the new surface? Assume interest at 5%.

Reference no: EM131884029

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