You bought an appliance and the salesperson offered you a warranty that costs $99 a...
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You bought an appliance and the salesperson offered you a warranty that costs $99 a year. You did some research andfound that the average cost of a repair for your appllance Is $500. Which statement is true?Using your knowledge of probability and expected value, you decide you are more likely to come out ahead if you buy the warranty.Using your knowledge of probability and expected value, you decide your best option is to refuse the warranty.A person who uses the item more frequently than you is less likely to benefit from the warranty. It is never a good decision to buy a warranty.
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