MANAGERIAL SCIENCE

Consider the three grocery stores, Murphy's Foodliner, Ashley's Supermarket and Quick Stop Groceries. Quick Stop Groceries is smaller than either Murphy's Foodliner or Ashley's Supermarket. However, Quick Stop's convenience with faster service and gasoline for automobiles can be expected to attract some customers who currently make weekly shopping visits to either Murphy's or Ashley's. Assume that the transition probabilities are as follows:

REQUIRED: (Show complete solution)

a.What are the projected market shares for the two brands?

b.With 2000 customers, which store appears to have the most loyal customers? Explain.

To From Murphy's Ashley's Quick Stop Murphy's Foodliner 0.85 0.10 0.05 Ashley's Supermarket 0.20 0.75 0.05 Quick Stop Groceries 0.15 0.10 0.75