How much would Apple charge me for repairs?

Apple told me that they would charge me up to $359.00 for my ipod touch They said "If apple confirms that service is covered but you fail to follow instructions on returning the part, you will be charged a non return fee of $359.00" Why is it so much? My iPod cost less than that!

- Unless the iPod is unrepairable, Apple will exchange the iPod for a refurbished one for this price:
Apple - Support - iPod - Repair pricing
- Are you contacting Apple or an Authorized Service Provider?

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