A machine costs a company $52,000 and its effective life is estimated to be 25 years. A sinking fund is created for replacing the machine by a new model at the end of its life time, when its scrap realizes a sum of $2,500 only. The price of the new model is estimated to be 25 per cent higher than the price of the present one. Find what amount should be set aside every year. Out of the profits for the sinking fund, if it accumulates at 3½ per cent per annum compound.
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