Question

Problem 16-07 (Algorithmic)

Data collected from selected major metropolitan areas in the eastern United States show that 6% of individuals living within the city limits move to the suburbs during a one-year period, while 2% of individuals living in the suburbs move to the city during a one-year period. Answer the following questions assuming that this process is modeled by a Markov process with two states: city and suburbs.

1. Prepare the matrix of transition probabilities.
   

   	City	Suburbs
   City	__________	_________
   Suburbs	__________	__________

2. Compute the steady-state probabilities. If required, round your answer to three decimal places.
   
   = __________
   
   = __________

C. In a particular metropolitan area, 40% of the population lives in the city, and 60% of the population lives in the suburbs. What population changes do your steady-state probabilities project for this metropolitan area? If required, round your answer to the nearest whole number.

The area will show______________________ in the suburb population and __________________ in the city population. The current 40% in the city is expected to drop to around ____________________%.

Answer 1