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Find the equilibrium conditions for Problem 14-24. Explain what it means.
In Problem 14-24, Set up both the vector of state probabilities and the matrix of transition probabilities given the following information:
Store 1 currently has 40% of the market; store 2 currently has 60% of the market.
In each period, store 1 customers have an 80% chance of returning; 20% of switching to store 2.
In each period, store 2 customers have a 90% chance of returning; 10% of switching to store 1. |
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