Assignment:
Habard’s, a chain of hardware stores, sells a variety of tools and home repair items. One of their best wrenches sells for $5.50. Habard’s will include a three-year free replacement warranty for an additional $1.50. The wrench is expected to be subject to heavy use and, based on past experience, will fail randomly at a rate of one every eight years. Is it worth purchasing the warranty?
Provide complete and step by step solution for the question and show calculations and use formulas.