Table 15-2 The Following Data Consists of a Matrix of Transition Probabilities

question 2

Multiple Choice

Table 15-2
The following data consists of a matrix of transition probabilities (P) of three competing retailers, the initial market share π(0) . Assume that each state represents a retailer (Retailer 1, Retailer 2, Retailer 3, respectively) and the transition probabilities represent changes from one month to the next.
P = π(0) = (0.3, 0.6, 0.1)
-Using the data given in Table 15-2, find the market shares for the three retailers in month 1.

• A) π(1) = (0.09, 0.42, 0.49)
• B) π(1) = (0.55, 0.33, 0.12)
• C) π(1) = (0.18, 0.12, 0.70)
• D) π(1) = (0.55, 0.12, 0.33)
• E) π(1) = (0.33, 0.33, 0.33)

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