The Value of Call Monitoring Comcast's call center had a problem with unresolved incidents. Customers who called in for technical help often had to make follow-up calls because the first recommended solution did not work. Since the call center staff
were expected to handle an average of 10 calls per hour, Comcast suspected that calls were being terminated before the complaint had been resolved. As a possible solution, they hired supervisors to randomly listen into calls so as to better monitor inappropriate call terminations at a cost of $8,000 per month. This cut down the need for follow-up calls and, more importantly, increased customer retention. The number of customers who called in a complaint and would terminate services within three months was cut from 150 to 130 . How large must the present value of a retained customer's contribution margin be for additional monitoring to be profitable?
Comcast retained an additional 20 customers at a cost of $8,000 or it cost them $400 per customer retained. So long as the present value of the contribution that a typical customer represents over a typical time horizon exceeds $400, the monitoring is profitable.
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If the Fed increases interest rates, other things remaining the same, foreigners demand ________ dollars thereby ________ the exchange rate
A) more; increasing B) more; decreasing C) fewer; increasing D) fewer; decreasing E) the same number of; not affecting
Higher prices for scarcer resources can improve the efficiency of an economy.
Answer the following statement true (T) or false (F)
Larry was accepted at three different graduate schools, and must choose one. Elite U costs $50,000 per year and did not offer Larry any financial aid. Larry values attending Elite U at $60,000 per year. State College costs $30,000 per year, and offered Larry an annual $10,000 scholarship. Larry values attending State College at $40,000 per year. NoName U costs $20,000 per year, and offered Larry a full $20,000 annual scholarship. Larry values attending NoName at $15,000 per year. Larry's opportunity cost of attending State College is:
A. $20,000 B. $35,000 C. $15,000 D. $30,000
Marco observed that every time the temperature rises above 90 degrees, he forgets to take out the trash. Based on this observation he concluded that temperatures above 90 degrees result in temporary memory loss. In actuality, Marco
A. committed the fallacy of logic. B. showed good reasoning relating to the relationship between temperatures and memory. C. was confusing causality. D. committed the ceteris paribus error.