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What is the total value of the current base of members

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Reference no: EM133404049

Questions:

  1. What is the total value of the current base of members? (Assume an infinite horizon and a 10% discount rate.)
  2. Lionel Issem, director of marketing, has proposed a one-time expenditure of $60,000 to run an ad campaign aimed at acquiring new members. How many members would The Mondial need to acquire to make this investment pay off (breakeven) in the long term?
  3. Help Lionel find out the maximum amount of money they should spend to increase the retention rate of current customers from 80% to 85%, permanently.

Reference no: EM133404049

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