What value would you assign to the existing roof

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Reference no: EM132072714

You are considering the purchase of a nice home. It is perfect in every way for you and in excellent condition, except for the roof. The roof has only 5 years of life remaining. A new roof would last 20 years, but would cost $20,000. The house is expected to last forever. Assuming that costs remain constant and that the interest rate is 5%, what value would you assign to the existing roof?

Reference no: EM132072714

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