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Assume that a customer shops at a local grocery store spending an average of ​$400 a​...

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Finance

Assume that a customer shops at a local grocery store spendingan average of ​$400 a​ week, resulting in a retailer profit of ​$40each week from this customer. Assuming the shopper visits the storeall 52 weeks of the​ year, calculate the customer lifetime value ifthis shopper remains loyal over a​ 10-year life span. Also assume a3 percent annual interest rate and no initial cost to acquire thecustomer. The customer yields ​$ nothing per year in profits forthis retailer. ​(Round to the nearest​ dollar.)

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3.9 Ratings (471 Votes)
Solution The customer life time value if the shopper remainsloyal over a 10year life span is 177428219Thus the customer yields 17743per    See Answer
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