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Sam Myers sells televisions with a 2-year warranty. Past experience indicates that 2% of the units sold will be returned during the warranty period...

Sam Myers sells televisions with a 2-year warranty. Past experience indicates that 2% of the units sold will be returned during the warranty period for repairs. The average cost of repairs under warranty is estimated to be $50 per unit. During 2011, 12,000 units were sold at an average price of $400. During the year, repairs were made on 70 units at a cost of $4,000.

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