online assignment

463 Marketing Management: Chapter 1

· How would the lifetime value of the average customer change if the customer life was shortened from 5 to 4 years? 111.7-34.2= 77.5

· How would the lifetime value change if the customer life was extended from 5 to 6 years and in year 6 the net cash flow was $60?

· Present value of 1 dollar is .564

· 60*.564=33.84

· 111.7+33.8=145.54

· How would the average customer profitability change with 25 percent loyal and 25 percent repeat customers?

25	400		100
25	225		56.25
10	165		16.5
20	20		4
20	-20		-4

172.75