• My coursesQuantitatives Methods for BusinessTopic 4DMS 111: QUANTITATIVE METHODS FOR BUSINESS - BCOM NAIROBI 12th July, 2021

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Samburu estatehas twopetrolstations,MafutaandPetroli. The residents of theestate buy fuelat the two stations on a monthly basis.A recentsurvey found that the customers were not totally loyal to eitherpetrol station and that they were willing to change as a result of advertising, service, and other factors.It was established thatif a customer boughtfuelfromMafutain any given month, there was only a60% chancethat the customer would buy fromMafutathe next month and a40% likelihoodthat the customer would buyfuelfromPetrolithe next month. Likewise, if a customer traded withPetroliin a given month, there was an80%that the customer wouldbuy fuelfromPetroliin the next month and a 20% likelihoodthat the customer would purchase gasoline fromMafuta.

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What is thethe probability of a customer trading withPetroliinthe long run, given that the customer initially traded withPetroliin month 1?