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An arithmetic gradient series is one in which each payment differs from the previous one by a

  • A.constant percentage
  • B.random amount
  • C.constant ratio to the first payment
  • D.constant amount

Answer: D

Maintenance costs rising by a fixed sum each year are the standard example, and the increment is the same whatever the level already reached. A constant percentage change is a geometric gradient and needs a different factor entirely.

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