Asked by tatiana

A company estimates that 0.4% of their products will fail after the original warranty period but within 2 years of the purchase, with a replacement cost of $300.

If they offer a 2 year extended warranty for $46, what is the company's expected value of each warranty sold?

9 years ago

Answered by John1

.004(-300)+.996(46)

9 years ago

Answered by tatiana

iS IT 44.616

9 years ago

Answered by John1

Yes

9 years ago

Answered by jake

john failed, thanks for the way to figure it out, used it on my online quiz and was wrong.

8 years ago

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Asked by tatiana

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