Quiz Instructions Sam is offered to purchase a 2-year extended warranty from a retailer to cover the value of his new appliance in case it gets damaged or becomes inoperable for the price of $25. Sam's appliance is worth $1000 and the probability that it will get damaged or becomes inoperable during the length of the extended warranty is estimated to be 3%. Answer the following questions. D Question 1 1 pts What is the cost to the retailer, if the applicance becomes inoperable within the two year extended warranty period, if Sam buys the warranty? 0 $1000 prot 0 -$975 cost 0 $25 prot 0 $24.75 prot Question 2 1 pts What is the probability that the appliance does not break down during the two year extended warranty period? 0 0.03 O 3 o 0.97 O 9.7 Question 3 1 pts What is the cost (or prot) for the retailer, if the appliance does not become inoperative during the two year extended warranty, if Sam buys the two year extended warranty? 0 $300.00 prot 0 $0.75 prot 0 $25.00 prot 0 $975.00 cost Question 4 Overall, what is the expected cost [or prot) for the retailer? 0 1752930 cost 0 $ 5.00 cost 0 $25.00 prot 0 $24.30 prot Question 5 Should Sam purchase the warranty? 0 Yes, expected prot of the retailer is a negative value 0 No, expected prot of the retailer is a positive value