Over the past year, a gourmet coffee subscription company recorded a significant increase in the total number of monthly account cancellations. However, during that same year, the company's monthly cancellation rate—defined as the percentage of total active subscribers who canceled their accounts each month—steadily decreased.
Which of the following, if true, best helps to resolve the apparent paradox described above?
- The total number of active subscribers to the coffee service increased substantially over the course of the year.Cevap
- BCustomer satisfaction surveys showed that most subscribers who canceled were dissatisfied with recent delivery delays.
- CThe subscription company increased its monthly service fees substantially at the start of the year.
- DThe company introduced several new premium coffee roasts mid-way through the year.
- ECompeting subscription services experienced a similar rise in the overall number of customer cancellations.
Cevap
The total number of active subscribers to the coffee service increased substantially over the course of the year.
The correct answer resolves the paradox by identifying a shift in the overall subscriber base. Total cancellations equal the cancellation rate multiplied by the total number of active subscribers. If the total subscriber base grew substantially, a lower percentage cancellation rate would still yield a higher absolute number of cancellations.
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Resolving Rate versus Total Volume Discrepancies