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3 years ago

Why does the “rfm” rubric present the three key measures (recency, frequency, and monetary value) in that order?

1 answer:

5 0

The order of the attributes in RFM conforms to the order of their importance in ranking customers. Recency is the most important factor. Recency alone won’t sort out your good customers from your new ones. You need frequency for that. Frequency measures the intensity of a customer’s relationship with your business. How much a customer spends on average or in total is the final measure of his or her monetary value.

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When the indirect method is used, if accounts receivable increases during the accounting period, the change in accounts receivab

liberstina [14]

The answer is that "the change in accounts receivable is subtracted from net income".

When the indirect method is used, the starting point is the net income and it is transformed to cash flows from operational actions by adding back losses and subtracting gains so that these quantities are removed.

4 0

3 years ago

The risk-free rate of return is 10.5%, the expected rate of return on the market portfolio is 17%, and the stock of Xyrong Corpo

nadezda [96]

Answer:

$88.24

Explanation:

The computation of the intrinsic value of a share of Xyrong stock is shown below;

k = risk free rate of retunr+ beta[expected market rate of return - risk free rate of return]

= 10.5% + 1.5(17% - 10.5%)

= 20.25%

Now

growth rate = b × ROE

= .5 × 24%

= 12%

Now the intrinsic value of the stock is

= (($13 × 50%) × (1 + 0.12)) ÷ (0.2025 - 0.12)

= $88.24

5 0

3 years ago

Use the following information to answer this question. Windswept, Inc. 2017 Income Statement ($ in millions) Net sales $ 9,500 C

romanna [79]

Answer:

The return on equity for 2017 is 21.46 %

Explanation:

Return on equity measures the return earned on the owners investment in the company.

Return on equity = Net Income for the year / Total Shareholders Funds × 100

= $822 / ( $2,980 + $850) × 100

= 21.4621 or 21.46 %

Note : That Retained earning is part of Owners Investment.

Conclusion :

The return on equity for 2017 is 21.46 %

6 0

3 years ago

Martin is offered an investment where for $6000 today, he will receive $6180 in one year. He decides to borrow $6000 from the ba

Ne4ueva [31]

Answer:

The maximum interest rate which the bank needs to offer the loan is 3%

Explanation:

The maximum interest rate which the bank needs to offer the loan is computed as:

Maximum interest rate = Amount received in one year - Amount invested today / Amount invested today

where

Amount received in one year is $6,180

Amount invested today is $6,000

Putting the values above:

Maximum interest rate = ($6,180 - $6,000) / $6,000

= $180 / $6,000

= 3%

So, the maximum interest rate is 3% which is needed to offer by banks

3 0

3 years ago

All of the following would be considered closing costs except for: a) A title search b) Cost of repainting the kitchen before mo

otez555 [7]

B/ Cost of repainting the kitchen before moving in

5 0

3 years ago