Question 3 Q3: Assume that Shannon's current CLV=$142.00. Based on the change in CLV you computed in the last question, should Shannon's implement the rewards program? Yes introduce rewards program. -- No do not introduce rewards program -- ○ There is insufficient data to answer "yes" or "no." Question 4 Q4: Assume that Shannon's decides to move forward with its loyalty/rewards program. Estimates for the cost per customer is $6.07 per month. Average customer margins, before subtracting off the cost of the loyalty/rewards program, are expected to be 34.18. Assuming that Shannon's wishes to obtain a minimum CLV of $120, what is the required retention rate that must be achieved? Assume that the interest rate is 1% per month. (Note: This problem assumes that you employ some algebra to solve the CLV formula for r.) Express your answer to four decimal places e.g. .1234. Do not express in percent form.
Question 3 Q3: Assume that Shannon's current CLV=$142.00. Based on the change in CLV you computed in the last question, should Shannon's implement the rewards program? Yes introduce rewards program. -- No do not introduce rewards program -- ○ There is insufficient data to answer "yes" or "no." Question 4 Q4: Assume that Shannon's decides to move forward with its loyalty/rewards program. Estimates for the cost per customer is $6.07 per month. Average customer margins, before subtracting off the cost of the loyalty/rewards program, are expected to be 34.18. Assuming that Shannon's wishes to obtain a minimum CLV of $120, what is the required retention rate that must be achieved? Assume that the interest rate is 1% per month. (Note: This problem assumes that you employ some algebra to solve the CLV formula for r.) Express your answer to four decimal places e.g. .1234. Do not express in percent form.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Question 3
Q3: Assume that Shannon's current CLV=$142.00. Based on the change in
CLV you computed in the last question, should Shannon's implement the
rewards program?
Yes introduce rewards program.
--
No do not introduce rewards program
--
○ There is insufficient data to answer "yes" or "no."
Question 4
Q4: Assume that Shannon's decides to move forward with its
loyalty/rewards program. Estimates for the cost per customer is $6.07 per
month. Average customer margins, before subtracting off the cost of the
loyalty/rewards program, are expected to be 34.18. Assuming that
Shannon's wishes to obtain a minimum CLV of $120, what is the required
retention rate that must be achieved? Assume that the interest rate is 1%
per month. (Note: This problem assumes that you employ some algebra to
solve the CLV formula for r.) Express your answer to four decimal places e.g.
.1234. Do not express in percent form.
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