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(Warranty). A warranty is written on a product worth $10,000 so that the buyer is given $8000 if it fails in the first year, $6000
(Warranty). A warranty is written on a product worth $10,000 so that the buyer is given $8000 if
it fails in the first year, $6000 if it fails in the second, $4000 if it fails in third, $2000 if it fails in
the fourth, and zero after that. Its probability of failing in a year is 0.1; failures are independent
of those of other years. What is the expected value of the warranty? Also find the variance?
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