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Linear AlgebraHardMarkov Chains & Long-Run Behavior

Markov Chains & Long-Run Behavior · Hard problem

Two rival models predict how customers switch between Coffee Shop A and Shop B each month. Model 1: AA keeps a customer with probability 0.70.7 (otherwise switches to BB); BB keeps with probability 0.60.6. Model 2: AA keeps with probability 0.650.65; BB keeps with probability 0.550.55. Under which model does Shop A have the higher long-run market share, and what is the positive difference between the two models' steady-state shares for AA? Express your answer as a common fraction.