The Cost of Retaining Existing Customers Is Estimated to Be

question 21

True/False

The cost of retaining existing customers is estimated to be three to five times more expensive than it is to gain new customers.

---

Definitions:

Efficient

The optimal allocation and utilization of resources to achieve the best possible outcome or output.

Excess Capacity

Excess capacity occurs when a firm's actual production is less than its maximum possible output, often indicating underutilized resources or insufficient demand.

Perfect Competition

An economic model describing a market where no buyer or seller has the market power to influence prices, characterized by many participants and free entry and exit.

Profit Maximization

The process or strategy undertaken by a firm to generate the maximum possible profits with the available resources and market conditions.