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Expected value of the extended warranty

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A big-brand-name dishwasher, which costs $800.00, has a 20% chance of needing to be replaced in the first 2 years of purchase. A two-year extended warranty costs $112.10 on a dishwasher. What is the expected value of the extended warranty assuming it is replaced in the first 2 years?

Reference no: EM132012042

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