You are Ranjit Sidhu, the CFO $($chief financial officer$)$ of Electro Tools Ltd$.,$ a Canadian public company that manufactures electronic appliances. Electro Tools sells its products to major retailers such as Future Shop and Best Buy. The company$$s CEO $($chief executive officer$),$ Robert Watt, visited your office in early $2023$ and advised that at the recent board of directors$$ meeting he was told to look for ways to increase the company$$s revenues. He is considering making changes to the company$$s warranty and reward programs to achieve this goal.

$.$ The company currently offers warranties separately from the products it sells. This means that a consumer purchases the product without a warranty. They are then offered $($by the retailer on Electro$$s behalf$)$ the opportunity to purchase a three$-$year warranty on the product. Approximately $70\%$ of consumers currently purchase the warranty. Mr$.$ Watt is considering changing this practice to bundling the two products such that the down$-$stream customer is automatically provided with a warranty when they purchase Electro$$s product. The new price of the bundled product would be the sum of the current sales prices of the appliance and warranty purchased separately.

To encourage retailers to purchase the company$$s products, Electro Tools employs a reward program. Retailers that reach pre$-$specified levels of purchases in the current year are provided with a cash discount the following year. For example, if a retailer makes purchases of between $$1$ million and $$2$ million during the year, then it is entitled to a $2\%$ discount on all purchases in the following year. Purchases in the ran