Michael is handicapped and it makes him a little slow, but if you call him retarded he'll run after you with a giant stick and make you take it back!
Person 2: Hey, I would appreciate it if you didn’t use that word around me anymore. When you use "retarded" as a synonym for "stupid" or "idiotic," you are saying that all people with intellectual disabilities are stupid, and that’s definitely not true.
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If you want to tick off a politically correct person, just say it. They think it's mean because people with mental problems are not always stupid, except you can't call those people "retarded" in the first place, and nobody cares anyway. Plus, once again, it's from the Latin word for "slow".
Guy 2 to Guy 3: Look at Guy 1 dancing like he's retarded.