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morpeh [17]
3 years ago
6

A commercial cleaning company spends an average of $500 per year, per customer, in supplies, wages, and account maintenance. An

average customer generates $1,000 in revenue per year. Assuming a discount rate of 12% and an annual retention rate of 80%, what is the best estimate for the lifetime value of an average customer using the simplified customer lifetime value (CLV) equation presented in the core reading?
Business
1 answer:
Sonbull [250]3 years ago
5 0

Answer:

$1,250

Explanation:

Calculation for what is the best estimate for the lifetime value of an average customer using the simplified customer lifetime value (CLV) equation

Using this formula

Customer lifetime value (CLV) = r / (1 + i - r)

Let plug in the formula for

Customer lifetime value (CLV) = 0.8 / (1 + 0.12 - 0.8)

Customer lifetime value (CLV) = 2.5

Customer lifetime value (CLV) =($1,000-$5,00)× 2.5

Customer lifetime value (CLV) = $500 x 2.5

Customer lifetime value (CLV) = $1,250

Therefore the best estimate for the lifetime value of an average customer using the simplified customer lifetime value (CLV) equation will be $1,250

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A small business is currently using a paper-based system for billing, which is slow and error-prone. Which system upgrade will m
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Answer: Source data automation

Explanation: Source data automation involves inputing data in a digital format from the point of origin. This method makes use of automated methods to collect data directly from the source right at the beginning. And in doing so, this process eliminates any duplicated effort, potential for errors and delays in any unnecessary handling.

4 0
3 years ago
Suppose the total number of minutes provided exceeds the total number of minutes estimated and that the total dollar cost of the
Margarita [4]

Answer:

C) In at least one of the higher technical levels ,more minutes being provided than budgeted.

Explanation:

For such discrepancy to exist ,it means the minutes dictates the effect of the dollar.

5 0
3 years ago
The beginning capital balance shown on a statement of owner's equity is $80,000. Net income for the period is $35,000. The owner
jonny [76]

Answer:

Correct option is (B)

Explanation:

Given:

Beginning capital = $80,000

Net income = $35,000

Drawings = $18,000

Net income is added to opening capital and deduct drawings to arrive at capital balance at the end.

Capital at the end of the year = opening capital + net income - drawings

                                                 = 80,000 + 35,000 - 18,000

                                                 = $97,000

7 0
3 years ago
Consider a $1,000 par value bond with a 9% annual coupon. The bond pays interest annually. There are 20 years remaining until ma
Vinvika [58]

Answer:

The multiple choices are:

a. $1132

b. $1044

c. $ 962

d. $1153

e. $ 988

The correct option is C,$962

Explanation:

The price a rational and prudent investor like me would be willing to pay for the bond today is the present worth of future cash inflows receivable from the bond issuer,which comprises of annual coupon interest and the face value at maturity.

=-pv(rate,nper,pmt,fv)

rate is required rate of return expected by investor of 10%

nper is 5 years since the investor intends to hold the bond for 5 years

pmt is the annual coupon interest=$1000*9%=$90

fv is the face value of $1000

=-pv(10%,5,90,1000)=$962.09

The current  price is $962

4 0
3 years ago
It is advisable to spend less money on wants than you do on needs.true or false
aev [14]
True, you don’t want to spend more money on wants instead of needs because if you do you won’t have enough money for things that you really need.
5 0
3 years ago
Read 2 more answers
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