Business, 06.06.2020 01:57 rosieposie27
In 2006, an online video rental service that offered a single subscription plan of $5.99 per month for 3 DVD rentals had 306,000 subscribers. This was an increase of 10% over the previous year, and 88,000 were new subscribers. They estimated that they spent $15.60 in acquiring each customer and that for each consumer they incurred annual variable costs (on fulfillment, technology, etc) of $32.
If you were to value their current customer base at the end of 2006, what would it be? (calculate CLV using the corrected CLV formula, apply to total number of subscribers).
Corrected CLV formula = CLV = m x ((1+ i)/(1+i -RR)) - AC
i = discount rate
RR = rentention rate
AC = acquisition costsM = Contribution margin
Notes:
For purposes of this exercise, assume this business model can survive, and the discount rate as 10%. Don't forget to convert the revenue to annual figures! Be careful when calculating churn/retention; it is not straightforward.
Answers: 2
Another question on Business
Business, 22.06.2019 10:20
Sye chase started and operated a small family architectural firm in 2016. the firm was affected by two events: (1) chase provided $25,000 of services on account, and (2) he purchased $2,800 of supplies on account. there were $250 of supplies on hand as of december 31, 2016. record the two transactions in the accounts. record the required year-end adjusting entry to reflect the use of supplies and the required closing entries. post the entries in the t-accounts and prepare a post-closing trial balance.
Answers: 1
Business, 22.06.2019 16:00
What impact might an economic downturn have on a borrower’s fixed-rate mortgage? a. it might cause a borrower’s payments to go up. b. it might cause a borrower’s payments to go down. c. it has no impact because a fixed-rate mortgage cannot change. d. it has no impact because the economy does not affect interest rates.
Answers: 1
Business, 22.06.2019 18:00
Interpreting the income tax expense footnote the income tax footnote to the financial statements of fedex corporation follows. the components of the provision for income taxes for the years ended may 31 were as follows: ($ millions) 2010 2009 2008 current provision domestic federal $ 36 $ (35) $ 514 state and local 54 18 74 foreign 207 214 242 297 197 830 deferred provisions (benefit) domestic federal 408 327 31 state and local 15 48 (2) foreign (10) 7 32 413 382 61 provision for income taxes $ 710 $ 579 $ 891 (a)what is the amount of income tax expense reported in fedex's 2010, 2009, and 2008 income statements?
Answers: 2
Business, 22.06.2019 23:00
Abeverage company puts game pieces under the caps of its drinks and claims that one in six game pieces wins a prize. the official rules of the contest state that the odds of winning a prize are is the claim "one in six game pieces wins a prize" correct? why or why not? 1: 6.
Answers: 1
You know the right answer?
In 2006, an online video rental service that offered a single subscription plan of $5.99 per month f...
Questions
