What is the required retention rate

Assignment Help Finance Basics
Reference no: EM133073749

Assume that Shannon's decides to move forward with its loyalty/rewards program. Estimates for the cost per customer is $5.51 per month. Average customer margins, subtracting off the cost of the loyalty/rewards program, are expected to be . Assuming that Shannon's wishes to obtain a minimum CLV of , what is the required retention rate that must be achieved? Assume that the interest rate is per month. (Note: This problem assumes that you employ some algebra to solve the CLV formula for .) Express your answer to four decimal places e.g. .1234. Do not express in percent form.

Reference no: EM133073749

Questions Cloud

What is the current pvgo : What is the expected growth in dividend under the Gordon growth model? What is the current PVGO? What if the expected return is 6%? Explain the results.
Find the prices of the european call and put options : Consider a one-period model with 2 states and 2 assets: a bond and a stock. Assume that r= 0 so that the bond sells for $1 at t=0 and paid $1 at t=1. The initia
How much will be the total financing : If the beginning cash balance for a company is $90,000, its total cash available. How much will be the total financing that has a annual rate 10%
How long should you boil water to make it safe : How long should you boil water to make it safe to drink and What problem was caused by the popularity of medicinal leeches
What is the required retention rate : Assume that Shannon's decides to move forward with its loyalty/rewards program. Estimates for the cost per customer is $5.51 per month. Average customer margins
Calculate the ratio of the prevention : The following represents the financial information for Domingo Corporation for two months. Calculate the ratio of the prevention
What is the maximum sensible one-year spot rate : Corporate Bonds: (5 points) Prices for zero-coupon corporate bonds with face values of $1,000 and one year until maturity are summarized in the following table:
What is the bond yield-to-call : A $1,000 par value bond sells for $1,216. It matures in 20 years, has a 24 percent coupon, pays interest semiannually, and can be called in 5 years at a price o
What is the fraction of ownership : An investment bank is conducting an equity issuance to raise equity capital for a manufacturing ?rm to ?nance its $126 million new project that has a present va

Reviews

Write a Review

Finance Basics Questions & Answers

  What is the theoretical value of the right

What is the theoretical value of the right using the rights on case.

  Occurring with the use of variance analysis

What type of inventory control considerations do you think are occurring with the use of variance analysis?

  What is the integrity a right

Dot corporation has announced a right offer to raise 40 million. The subscription price is 50. Currently 4 million share outstanding at 56 each.

  Explain the theory of comparative advantage

Why do you suppose that foreign governments provide MNCs with incentives to undertake FDI in their countries?- Explain the theory of comparative advantage as a motive for foreign trade.

  How many more shares can be issued without the approval of

the authorized share capital of the alfred cake company is 100000 shares. the equity is currently shown in the

  Calculate the profit the firm will make on this asset

calculate the profit the firm will make on this asset. At what rate does the firm just break even? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g.,..

  Describe role and function of imf

Describe role and function of IMF, explain in your own, How IMF impact negatively on country's economy? Also define Special drawing rights.

  What is the effective rate of interest on the bank loan

The Reynolds Corporation buys from its suppliers on terms of 2/19, net 50. Reynolds has not been utilizing the discounts offered and has been taking 50 days.

  Find the discounted payback

Fill in the table and find the discounted payback.

  Amount that should appear on garza balance sheet

Based on the above information, calculate the amount that should appear on Garza's balance sheet at December 31, 2010, for inventory.

  Implicit cost of trade credit under these terms

Book Depot Inc. sells on terms of 1/20, net 85. What is the implicit cost of trade credit under these terms? Use a 365-day year. Round the answer to two decimal places in percentage form.

  What is b&m partners return on equity

It had sales of $6,000,000 and a net income of $1,080,000. The company's total assets as of Dec. 31, 2009 were $14,000,000 and its total assets as of Dec. 31, 2010 were $18,000,000. What is B&M Partners' return on equity?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd