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A company estimates that 0.4% of their products will fail after the original warranty period but within 2 years of the purchase...Asked by amy
A company estimates that 0.2% of their products will fail after the original warranty period but within 2 years of the purchase, with a replacement cost of $450.
If they offer a 2 year extended warranty for $55, what is the company's expected value of each warranty sold?
If they offer a 2 year extended warranty for $55, what is the company's expected value of each warranty sold?
Answers
Answered by
bobpursley
ev=55-.002*450=55-.90 check my math
Answered by
askla
IT'S 54.1
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