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Consider a buyer who at the beginning of each month decides ...



Consider a buyer who at the beginning of each month decides whether to buy brand 1 or brand 2 that month. Each month the buyer will select either brand 1 or 2. The selection he makes at the beginning of any one month depends at most on the selection he made in the immediately preceding month and not on any other previous selections. Let Pyy denote the probability that at the beginning of any month the buyer selects brandſ given that he bought brand i the preceding month. Suppose it is known that P11 = (3/4). P12 = (1/4), p21 = (1/2) and P22 = (1/2). 1) First draw the transition diagram 2) Assuming that the first month under consideration is January, determine the distribution of probabilities for April.