a) Outline four applications of transition matrix in business (4 marks)

b) A bank classified its customers as loyal, switchers or split, depending on the numbers of orders placed in a year. Records indicate there are 200 customers who are classified as loyal and 200 also classified as switchers and 200 split: furthermore each year 10 of the loyal customers are re-classified as swiitchers and 24 split; 10 of the switchers customers are re-classified as loyal and 10 as split; and 18 of the split customers are re-classified as loyal and 20 as switchers.
Determine:
i. The transition matrix.
The percentage of customers that the company expect to have in each category in the long-run

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