A marketer of a product is willing to invest in the acquisition of new customers for two years. What would be the

upper limit of this investment, per customer, assuming the following retention$/$attrition rates $($see table below$)$

and assumptions? Should the marketer spend an additional $$7\mathrm{.}00$ per month to increase the retention rate by

$1\%$ per month $\{$e$.$g$.,97$ instead of $96$ or $76$ instead of $75)?$

$(20$ points$)$

Assumptions:

Revenue per customer per month $=$$$250$

Payments are made at the end of the month

Annual internal rate of retum of $18\%$ compounded monthly