GIS Help

Hi there,

I am not so new to GIS as I am new to writing GIS supporting software.
I wonder if I can call on the wealth of experience here to help me with
a problem.

I have a shape file of a road network. Along that network I have a
collection of reference points. These are actually measure points
along the road.

For instance one point may be at 2km and another at 3.5km.

The problem I have is that I want to add some more point data to the
map - at say 2.5 km, but I do not know the longs and lats of where I
have to add the new point.

Is the way to solve the problem start at the 2km point, and measure
down the shape to 500m to work out the long and lat? Is this how this
sort of problem is conventionally solved?

If so...what are the GIS terms that are used to descibe this type of
process "georeferencing?" "interpolation?" (so that I can start reading
up on it).

Anyones help would be much appreciated.

Thanks

.