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1. Finn's Fine Family Fotos is a chain of professional photography studios specializing in family portraits. They offer two kinds of picture packages: regular and

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1. Finn's Fine Family Fotos is a chain of professional photography studios specializing in family portraits. They offer two kinds of picture packages: regular and deluxe. Market research shows that, if a family in the area around the studio did not have a portrait done last year, then there is a 10% chance they will by a regular package this year, and a 8% chance they will buy a deluxe package. Also, if a family purchased a regular package last year, then there is a 35% chance they will not buy a package this year, but a 10% chance they will purchase a deluxe package. And, if a family purchased a deluxe package last year, there is a 10% chance they will not buy a package this year, but a 30% chance they will buy a regular package! (a) Suppose in the fifth year, the studio starts to give discounts to families that use the studio and that this changes the following percentages in the matrix (all others stay the same): if a family purchased a regular package, then there is a 25% chance that they will not return at all, but a 25% chance that they will buy a deluxe package. How will this affect the steady state solution? 1. Finn's Fine Family Fotos is a chain of professional photography studios specializing in family portraits. They offer two kinds of picture packages: regular and deluxe. Market research shows that, if a family in the area around the studio did not have a portrait done last year, then there is a 10% chance they will by a regular package this year, and a 8% chance they will buy a deluxe package. Also, if a family purchased a regular package last year, then there is a 35% chance they will not buy a package this year, but a 10% chance they will purchase a deluxe package. And, if a family purchased a deluxe package last year, there is a 10% chance they will not buy a package this year, but a 30% chance they will buy a regular package! (a) Suppose in the fifth year, the studio starts to give discounts to families that use the studio and that this changes the following percentages in the matrix (all others stay the same): if a family purchased a regular package, then there is a 25% chance that they will not return at all, but a 25% chance that they will buy a deluxe package. How will this affect the steady state solution

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