The Matrix of Transition Probabilities Below Deals with Brand Loyalty

question 10

Essay

The matrix of transition probabilities below deals with brand loyalty to Bark Bits and Canine Chow dog food. $$\begin{array} { c | c c } \text { Current } & { \text { Next Purchase } } \\\text { Purchase } & \text { Bark Bits } & \text { Canine Chow } \\\hline \text { Bark Bits } & .75 & .25 \\\text { Canine Chow } & .20 & .80\end{array}$$
a.What are the steady state probabilities?
b.What is the probability that a customer will switch brands on the next purchase after a large number of periods?