1. When computing customer lifetime value which two financial applications should be used? (3pts)

A. Beta and Net Present Value B. Discount Rate and Return on Investment C. Net Present Value and Return on Investment D. Lifetime Profits and Beta E. Discount Rate and Net Present Value

2. Increasing customer profits is an important part of customer retention. Which is not a beneficial strategy for increasing profits in later years of the relationship. (3 pts)

A. Using more cost-effective recruitment channels B. Reduce cost-to-serve C. Cross-selling or up-selling additional products and services D. All of the above

3. In your own words describe customer relationship management. How is it used, why is it used? What value does it add? (8pts)

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