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A manager at Shoeless Joes Sports Bar and Grill and was approached by a hockey team asking for sponsorship. Sponsorship would mean purchasing 1 8
A manager at Shoeless Joes Sports Bar and Grill and was approached by a hockey team asking for sponsorship. Sponsorship would mean purchasing jerseys for the team BUT would see the team visit the restaurant on a regular basis. The EXPECTED RETURNS for the restaurant from these visits would be Gross Sales of $ per year for an expected five years. Assume the restaurants profit margin on foodalcohol sales is so USE NET PROFIT of $ per year for all calculations Further, the jerseys would have the Shoeless Joes logo and act as advertising a goodwill function in accounting BUT this is not considered in the calculations. The manager remembers something about CLTV in college and wants to calculate the CLTV using different methods on ONLY the future expected business from the team $ per yearignore advertising or goodwill from the jerseys Determine:The CLTV of the team for five years using the Easy Method.The CLTV of the team using the Simple Formula, with a churn of The CLTV of the team using the Traditional Formula with a churn and a cost of money interest rate of paThe CLTV of the team using DCF over five years at compounded annually, assuming net profit per year $ at the end of every year use as PMTGiven the cost of the jerseys would be $ AND the CLTV of the four different methods you calculated what action should Alar take and why?
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