Customer Equity Is

question 280

Multiple Choice

Customer equity is

• A) simply the financial result achieved by a single marketing strategy.
• B) the total difference between the benefits of a firm's whole marketing program and total costs of obtaining those benefits, as the group of target customers sees it.
• C) increased when a firm is able to increase the earnings stream expected from current or prospective customers.
• D) decreased whenever the firm's costs of offering a marketing mix increase.
• E) the difference between the benefits of a firm's marketing mix and the cost of obtaining those benefits--as a particular customer sees it.

Allocate acquisition differential to identified assets and liabilities and understand its amortization.

Compute goodwill and recognize its impairment.

Prepare consolidated retained earnings statements.

Understand and calculate deferred taxes on unrealized profits.

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Definitions:

Inverse Demand Function

A mathematical representation that describes the relationship between the price of a good and the quantity that consumers are willing and able to purchase, expressed as price as a function of quantity demanded.

Marginal Cost

The expenditure involved in the production of an extra unit of a good or service.

Elasticity of Demand

An indicator of the degree to which demand for a product changes in response to a variation in its price, shown as a percentage.

Markup

The amount added to the cost price of goods to cover overhead and profit; a percentage over the cost.