SP Billing, Revenue Management, and Monetization 3

Question 1

What does ARPU stand for, and what does it measure?

Accepted Answer

Average Revenue Per User — mean revenue generated per subscriber in a period

Answer

Average Rate Per Upgrade — cost of hardware upgrades per subscriber

Answer

Annual Recurring Profit Utility — yearly net profit per account

Answer

Automated Revenue Processing Unit — a billing system component

Question 2

Which pricing strategy involves offering a basic service tier for free while charging for premium features or higher usage levels?

Accepted Answer

Freemium model

Answer

Penetration pricing

Answer

Cost-plus pricing

Answer

Skimming pricing

Question 3

What is a 'convergent billing system' in a service provider context?

Accepted Answer

A unified billing platform that processes charges for multiple service types (voice, data, TV, IoT) in a single system

Answer

A system that only handles mobile voice billing

Answer

A billing system that requires manual invoice approval before sending

Answer

A system that consolidates billing across multiple regions but handles one service type

Question 4

Under PCI-DSS compliance, service providers who store, process, or transmit cardholder data must meet which minimum requirement before handling recurring payments?

Accepted Answer

Achieve the appropriate PCI-DSS compliance level and complete annual assessments or self-assessment questionnaires

Answer

Register with FINRA as a payment processor

Answer

Obtain an FCC payment processing license

Answer

Use only government-approved encryption algorithms

Question 5

What is the purpose of a 'grace period' in subscription billing?

Accepted Answer

A defined period after a failed payment during which service continues while the provider retries collection

Answer

A promotional window during which new customers pay a reduced rate

Answer

The delay between service activation and first billing cycle

Answer

A cooling-off period during which a customer can cancel without penalty

Question 6

Which term describes the process of recognizing revenue only when it has been earned, regardless of when cash is received, as required under ASC 606 / IFRS 15?

Accepted Answer

Accrual-basis revenue recognition

Answer

Cash-basis accounting

Answer

Deferred revenue write-off

Answer

Mark-to-market accounting

Question 7

A service provider notices customers consistently cancel after the first billing cycle. Which analysis technique is most appropriate to diagnose this problem?

Accepted Answer

Cohort churn analysis

Answer

Network capacity planning analysis

Answer

Revenue leakage audit

Answer

SLA breach root cause analysis