A company makes electronic gadgets. one out of every 50 gadgets is faulty, but the company doesn't know which ones are faulty until a buyer complains. Suppose the company makes a $3 profit on the sale of any working gadget, but suffers a loss of $80 for every fault gadget because they have to repair the unit. Check whether the company can expect a profit in the long term. If the company could instead improve gadget reliability so that only 1% of gadgets were faulty, what is the allowable reduction in profit per unit that the comnany can afford?

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