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customer? Compute your answer to the nearest penny.

customer? Compute your answer to the nearest penny.

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Q1: Shannon's brewery currently boasts a customer base of 1,750 customers that frequent the brewhouse on average twice per month and spend $26 per visit. Shannon 's current variable cost of goods sold is 50% of sales. The customer retention rate per month is 0.78, based on data collected from its website and an analysis of credit card receipts. Its current cost of capital for borrowing and investing is about 12% per year, or 1% per month. What is Shannon's approximate CLV for its average customer? Compute your answer to the nearest penny.
Transcribed Image Text:Q1: Shannon's brewery currently boasts a customer base of 1,750 customers that frequent the brewhouse on average twice per month and spend $26 per visit. Shannon 's current variable cost of goods sold is 50% of sales. The customer retention rate per month is 0.78, based on data collected from its website and an analysis of credit card receipts. Its current cost of capital for borrowing and investing is about 12% per year, or 1% per month. What is Shannon's approximate CLV for its average customer? Compute your answer to the nearest penny.
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