Problem Statement

Consider a mobile phone service company with 80 million subscribers as of Jan 1st, 2018. Currently, 70% of the subscribers have insurance. Monthly fees for the insurance: $5; Monthly fee for phone service: $30. Subscriber churn (attrition) rate: 2.8% per month without insurance; 2.5% per month with insurance. Assume no new customers are added. What would have been the additional revenues per month for the 2nd month (Feb 2018), if the original share of insurance subscribers was 25% of the carrier subscribers (compared to a baseline of 0% insurance)? $11.4m $9.9m $12.2m $12m A ride sharing company in Kerala has a rate card: SUV (Service charge: Rs. 200, 0-10 KM fixed: Rs. 300, >10 KM: Rs. 50/km); Sedan (Service charge: Rs. 150, 0-10 KM fixed: Rs. 250, >10 KM: Rs. 40/km). There are 1,000,000 customers in Kerala. On average, customers make 2 trips per month and travel 15 km per trip. 20% use SUV and 80% use Sedan. If our client has a 10% market share, what is the annual revenue for o