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Eoin plans to purchase 6.50 pounds of cheese that costs $4.75 per pound. He used the following steps to estimate the cost.

Step 1: Round 6.50 pounds up to 7.
Step 2: Round $4.75 up to $5.00.
Step 3: Multiply 5 by 7 to get 35.
Step 4: Conclude that the cost will be just over $35.00.

In which step does Eoin make a mistake?