Betancourt Company sells automatic can openers under a 75-day warranty for defective merchandise. Based on past experience, Betancourt estimates that 4% of the units sold will become defective during the warranty period. Management estimates that the average cost of replacing or repairing a defective unit is $25. The units sold and units defective that occurred during the last 2 months of 2017 are as follows.

Month		Units Sold		Units Defective Prior to December 31
November		30,200		604
December		32,200		403

please not only give the correct answer but also explain how it was obtained

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