Customer $3$

When the third customer declined the service plan, Alan again said, "You know, these

new $1080$p sets have a lot of pixels. Sometimes one freezes up or goes dark$-$makes it

kind of irritating to watch, especially with sports. You said you'd be watching a lot of

sports on this set? The extended service plan would fix or replace your TV if anything

like that happened."

This customer then asked him, "Does that happen very often?"

Alan replied, "I don't know. I just started working here."

In this scenario, the store sells a service plan for about $$100$ on a $$900$ HDTV$.$ On

average, it pays out $$20$ for actual service and replacements and keeps an average

of $$80.$ Is the $$100$ price appropriate?

Building on the example in the first question, what is the highest charge that would

be appropriate? Circle your answer below.

$$20$

$$40$

$$60$

$$80$

$$100$

$$125$

$$150$

$$200$

$$250$

As Much as

People Will Pay

Is Alan's statement to Customer $1$ ethical?

Is Alan's statement to Customer $2$ ethical?

Is Alan's statement to Customer $3$ ethical?