a. Based on a two-period tree diagram for a customer who last purchased MilkyChoc, the probability that this customer purchases MilkyChoc on the second purchase is % b. The long-run market share for MilkyChoc is % and for ChocoMilk is % c. A MilkyChoc advertising campaign is being planned to increase the probability of attracting ChocoMilk customers. Management believes that the new campaign will increase to 0.50 the probability of a customer switching from ChocoMilk to MilkyChoc. The projected market share for MilkyChoc after the campaign is %.
a. Based on a two-period tree diagram for a customer who last purchased MilkyChoc, the probability that this customer purchases MilkyChoc on the second purchase is % b. The long-run market share for MilkyChoc is % and for ChocoMilk is % c. A MilkyChoc advertising campaign is being planned to increase the probability of attracting ChocoMilk customers. Management believes that the new campaign will increase to 0.50 the probability of a customer switching from ChocoMilk to MilkyChoc. The projected market share for MilkyChoc after the campaign is %.
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
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I am currently having some trouble with the following prblems on excel. My teacher explained them to me however I do not understand still. Thank you
Transcribed Image Text:Markov Analysis
Management of a Milk Chocolate Galore company believes that the probability of a customer purchasing its MilkyChoc or the company's major competition,
ChocoMilk, is based on the customer's most recent purchase. Suppose that the following transition probabilities are appropriate:
To
From
MilkyChoc
ChocoMilk
MilkyChoc
ChocoMilk
0.7
0.3
0.4
0.6
a. Based on a two-period tree diagram for a customer who last purchased MilkyChoc, the probability that this customer purchases MilkyChoc on the
second purchase is
%
b. The long-run market share for MilkyChoc is
% and for ChocoMilk is
c. A MilkyChoc advertising campaign is being planned to increase the probability of attracting ChocoMilk customers. Management believes that the
new campaign will increase to 0.50 the probability of a customer switching from ChocoMilk to MilkyChoc. The projected market share for
MilkyChoc after the campaign is
%.
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