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The efficiency gains resulting from a just-in-time inventory management system will allow a firm to reduce its level of inventories immediately and permanently by $350,000.

The efficiency gains resulting from a just-in-time inventory management system will allow a firm to reduce its level of inventories immediately and permanently by $350,000. What is the most the firm should be willing to pay for installing the system?

The opportunity cost of capital for the firm is 10%.

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