The cellular phone industry is very competitive. Two companies in the greater Lubbock area, Horizon and Local Cellular, are constantly battling each other in an attempt to control the market. Each company has a one-year service agreement. At the end of each year, some customers will renew, while some will switch to the other company. Horizon customers tend to be loyal, and 80% renew, while 20% switch.

About 70% of the Local Cellular customers renew with them and about 30% switch to Horizon. If there are currently 100,000 Horizon customers this year, and 80,000 Local Cellular customers, how many would we expect each company to have next year?