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Assume a customer has been with a company for 10 years and has made purchases at...

Assume a customer has been with a company for 10 years and has made purchases at times .2, 1.2, .8, and 3. Estimate the probability the customer is still alive.

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Answer #1

If be the number of purchases, be the time of last purchase, be the time elapsed between acquisition of customer and present time, then the probability that the customer is still alive at time is given by ​, where

Here and

The probability that the customer is still alive is [Ans.]

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