Question
Support SUPERTEL, a new Telecommunication company, in calculating the Lifetime Value per customer based on the following assumptions: Perform the necessary calculations (A THROUGH K
Support SUPERTEL, a new Telecommunication company, in calculating the Lifetime Value per customer based on the following assumptions: Perform the necessary calculations (A THROUGH K NEEDS TO BE CALCULATED):
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
Revenue |
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A Customers | 2,000 |
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B Retention rate | 30 % | 40 % | 55 % | 65 % | 70 % |
C Average yearly sales | $250 | $250 | $250 | $250 | $250 |
D Total revenue |
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Costs |
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E Cost percentage | 50 % | 50 % | 50 % | 50 % | 50 % |
F Total costs |
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Profits |
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G Gross profit |
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H Discount rate | 1 | 1.15 |
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I NPV profit |
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J Cumulative NPV profit |
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K Lifetime value (NPV) |
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