Analyzing Subscriber Retention Models

The video tutorial discusses a cable company's subscriber loss due to poor customer service, losing 3% annually. It models subscriber retention using a mathematical function, explaining how to calculate the number of subscribers over time. The tutorial also guides on choosing the correct function and eliminating incorrect models, emphasizing the importance of understanding retention rates and their impact on subscriber numbers.

What was the initial number of subscribers for the cable company at the start of 2014?

• 1 million

• 2 million

• 3 million

• 4 million

At what rate is the cable company losing subscribers annually?

• 3%

• 2%

• 1%

• 4%

If the company retains 97% of its subscribers each year, what percentage does it lose?

• 4%

• 2%

• 1%

• 3%

What is the retention rate of the cable company?

• 99%

• 97%

• 95%

• 90%

How do you calculate the number of subscribers after one year?

• Multiply by 0.97

• Multiply by 1.97

• Multiply by 1.03

• Multiply by 0.03

What does a retention rate of 97% imply?

• 97% loss

• 97% growth

• 3% growth

• 3% loss

What is the formula to calculate the number of subscribers after t years?

• 2 * 1.97^t

• 2 * 0.03^t

• 2 * 1.03^t

• 2 * 0.97^t

What does the exponent 't' represent in the formula 2 * 0.97^t?

• Retention rate

• Number of subscribers

• Years passed

• Initial subscribers

What is the initial value in the formula 2 * 0.97^t?

• Years passed

• Retention rate

• Initial subscribers

• Final subscribers

What is the effect of multiplying by 0.97 each year?

• Doubles subscribers

• Keeps subscribers constant

• Decreases subscribers

• Increases subscribers