Which of the Following Statements Concerning Customer Defection Rates Is

question 23

Multiple Choice

Which of the following statements concerning customer defection rates is incorrect?

• A) Defection rates are determined by customer loyalty.
• B) The longer a company holds on to a customer, the greater is the volume of customer-generated unit sales and the lower is the average cost of each sale.
• C) Lowering customer defection rates allows a company to achieve a lower cost structure.
• D) Research and development should address the issue of customer loyalty in product development.
• E) There is a positive relationship between the length of time that a customer stays with the company and profit per customer.

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Definitions:

Stimulus Contrast

The change in response strength or rate to a stimulus when the background or context stimuli are altered.

Stimulus Generalization

The process in psychology where a response that has been conditioned to a specific stimulus is also elicited by similar stimuli.

Discriminative Operant

A type of operant conditioning in which behavior is controlled by stimuli that signal the reinforcement of a behavioral response.

Behavioral Contrast

A phenomenon where the rate of response to a stimulus changes significantly due to the introduction of a reinforcement or punishment to another stimulus.