Chat with AIExam 11: Optimizing Around the Customer: Measuring the Success of Customer-Based Initiatives and the Customer-Centric Organization
The actual economic value of any business enterprise can measured in terms of:
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VerifiedA
Explain fully why ROC = TSR.
(41) 
Answered by Examlex AI CopilotROC (Return on Capital) and TSR (Total Shareholder Return) are related because they both measure the performance and profitability of a company.
ROC measures the return generated on the capital invested in a company, taking into account both debt and equity. It is calculated by dividing the company's net operating profit after taxes (NOPAT) by the total capital invested. This gives an indication of how efficiently the company is using its capital to generate profits.
TSR, on the other hand, measures the total return that shareholders have received from their investment in the company. It takes into account both stock price appreciation and dividends paid to shareholders. TSR provides a comprehensive view of the company's performance by considering both capital gains and income from dividends.
The relationship between ROC and TSR lies in the fact that a high ROC can lead to a high TSR. When a company is able to generate a high return on its capital, it is likely to be more profitable and therefore more attractive to investors. This can lead to an increase in the company's stock price, resulting in a higher TSR for shareholders.
In summary, ROC and TSR are related because a high ROC can contribute to a high TSR by indicating that the company is effectively using its capital to generate profits, which can attract investors and drive up the stock price.
All of the following represent lifestyle changes relevant to predicting LTV change except:
(36) VerifiedA
Which of the following reasons help explain why companies tend to focus on short-term performance?
(41) List the four leading indicators for predicting LTV change and provide examples of each. Include both B2B and B2C examples.
(39) Customers create long-term value because they have __________ .
(37) Gupta and Lehmann's customer equity study showed that customer equity was measurably impacted most by:
(42) How would a company calculate its ROC? (Include relevant equations as well as a description of the process.) How might the results be used in daily decision making?
(30) Explain the difference between value creators, value harvesters, and value destroyers. What values and behaviors characterize companies in each category?
(42) The metric that measures how well an enterprise is using customers to create short-term and long-term value is:
(41) Illustrating the importance of the customer as financial asset, Amazon's Jeff Bezos has said that he prioritizes spending on all of the following except:
(39) All of the following are factors in defining customer equity except:
(37) Predictive modeling includes all of the following steps except:
(35) Define "customer equity" and explain why this concept is crucial to a company's profitability. What does it include? How is it measured? What are the obstacles to measuring it accurately?
(30) Losing a customer's business due to circumstances beyond a company's control is referred to as:
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