Question: A company calculates customer lifetime value ( CLV ) using a margin multiple ( m ) of 2 . 5 , corresponding to 8 0

A company calculates customer lifetime value (CLV) using a margin multiple (m) of 2.5, corresponding to 80% retention rate (r). The discount rate (i) of the firm is 12%. Assume the estimated average monthly revenue of a customer is $125, and the estimated average monthly cost of a customer is $40. Using the simplified CLV equation, what is the CLV of the average customer of this firm?
A.
$1,020
B.
$3,000
C.
$3,750
D.
$2,550
E.
$1,125

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