Question: please help 18 In this example, the following assumptions have been made The average customer cost is $7(C) The revenue stream from the customer is

please help 18 please help 18 In this example, the following assumptions have been made

In this example, the following assumptions have been made The average customer cost is $7(C) The revenue stream from the customer is $30 in each period (R) The discount rate of 10%(t) (start to apply at year 2 ) Retention rate of 80%(p) It costs $20(e,g. salaries and wages of the sales team, but not commissions) to acquire a customer (A). This acquisition cost is a fixed cost. What is the lifetime value of this customer at the end of year 2 and year 5 ? Year 2: \$16, Year 5: \$41 Year 2: \$20, Year 5:$47 Year 2: \$24, Year 5: \$44 Year 2: \$18, Year 5:$50 Year 2: \$22, Year 5: \$39

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