Question

If ABC Company has a customer that spends an average of $500 per month, what is the LTV of this customer over a 10-year time frame?

a. $150,000
b. $60,000
c. $32,000
d. $5,000

Answer 1

The Lifetime Value (LTV) of the customer over a 10-year time frame is $60,000.

Step-by-step explanation:

The lifetime value (LTV) of a customer is calculated by multiplying the average monthly spending by the number of months in the time frame. In this case, the average monthly spending is $500 and the time frame is 10 years, or 120 months. So, the LTV of this customer would be $500 x 120 = $60,000.