Final answer:
To create a customer satisfaction index, a business calculates the average of customer satisfaction ratings; it does not involve dividing by industry or competitor averages.
Step-by-step explanation:
To create an overall customer satisfaction index (CSI) for a given sample of customers, a business computes the average of those customers' satisfaction ratings. The CSI is an important measurement that reflects the degree to which customers are happy with a company's products or services. It's typically calculated by taking a sample of customer feedback, rating it on a consistent scale (e.g. a Likert scale), and then computing the average of these ratings to provide an overview of how the business is performing from the customers' perspective. This method ensures that each customer's satisfaction rating is given equal weight in the final index. However, the index is not divided by an industry or a competitor's average, as the option suggests; it is a standalone measure of a company's customer satisfaction performance.