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"No because $1000" is a valid answer in my house.

I don't think that anyone was suggesting that they will pay $1000 for a child to have a phone. The iPhone SE sells for $150 - $199 brand new from bestbuy: https://www.bestbuy.com/site/at-t-prepaid-apple-iphone-se-4g...

Good price - is that SIM-locked to the prepaid carrier?

Yes. I think it needs to be in service with them for 6(?) months before they unlock?