Question
An Internet service provider (ISP) acquires 1,000 customers who will pay $50 at the end of each month for the service, with a gross margin
An Internet service provider (ISP) acquires 1,000 customers who will pay $50 at the end of each month for the service, with a gross margin of $25. The ISP retains 80% of its customers each month and discontinues service immediately to anyone who fails to make a payment, without attempting to reactivate the customer.
- Find the CLV of this cohort, assuming a monthly discount rate of 1%.
- If the ISP only retains 70% of its customers, what is the decrease in CLV?
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Accounting For Decision Making And Control
Authors: Jerold Zimmerman
5th Edition
0072975865, 978-0072975864
