question archive For the information given, rank the customers in terms of customer lifetime value

For the information given, rank the customers in terms of customer lifetime value

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For the information given, rank the customers in terms of customer lifetime value.

Avg. Annual Sales Avg. Profit Margin Expected Lifetime

Customer 1:            Customer 2:                 Customer 3:

$3,450 $2,000 $1,400

17 % 13% 32 %

8 years 6 years 10 years

Use a discount rate of 6 percent and treat the average sales figures as annuities. Should any of these customers be fired?

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