To encourage students to shop at Wholefoods, one time 'Welcome Coupon' of $450 is given to each student during first year to spend on groceries at WF. The store wants to know how much each student spends at their stores and the associated costs to see the profitability of customers on individual basis. Whole Foods started tracking income from individual students and Sam was one of the customers randomly chosen for this study. The table below shows Sam's revenue and the associated expenses company incurred to acquire and maintain Sam as a loyal customer. As per company policy, strategies for customer retention is initiated if the projected LTV per customer greater than 4. Sam's average expenditure at WF for each year and WF costs of goods sold ( as % of sales revenue) is given below for the five years ( 2020 revenue figures are from records and other year revenues are WF projection). Assume 8% interest rate to calculate the present value of LTV. Please use the Present Value Table shown below.

2020 2021 2022 2023 2024 Sales Revenue $6,200 6,500 3,800 7,000 5200 COGS (as % of sales) 61.60% $3,819 Gross Margin $2,381 S & M expenses as % of sales Consumer Promotion 2.40% $149 Advertising 3.70% $229 Sales Force 5.60% $347 Administrative overhead 2.70% $167 Total S and M $893 Gen and Admin Expenses as % of sales 9% $558 Customer Acquisition Cost $450 Net Income $480 1% 2% 3% 4% 5% 6% 8% 10% 12% 0.9901 0.9804 0.9709 0.9615 0.9524 0.9434 0.9259 0.9091 0.8929 2 0.9803 0.9612 0.9426 0.9246 0.9070 0.8900 0.8573 0.8265 0.7972 3 0.9706 0.9423 0.9151 0.8890 0.8638 0.8396 0.7938 0.7513 0.7118 0.9610 0.9239 0.8885 0.8548 0.8227 0.7921 0.7350 0.6830 0.6355 5 0.9515 0.9057 0.8626 0.8219 0.7835 0.7473 0.6806 0.6209 0.5674 6 0.9421 0.8880 0.8375 0.7903 0.7462 0.7050 0.6302 0.5645 0.5066 7 0.9327 0.8706 0.8131 0.7599 0.7107 0.6651 0.5835 0.5132 0.4524 8 0.9235 0.8535 0.7894 0.7307 0.6768 0.6274 0.5403 0.4665 0.4039 9 0.9143 0.8368 0.7664 0.7026 0.6446 0.5919 0.5003 0.4241 0.3606 10 0.9053 0.8204 0.7441 0.6756 0.6139 0.5584 0.4632 0.3855 0.3220 3