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Using Diagonalization to to find the n-step tpm

+2 votes
asked Apr 30, 2017 in BUS 3018F - Models by ChanceTheRapper (650 points)

Tut 3 Q3.6 (Attached).

I'm trying to solve this like 3.5 but my issue is that equations 3 and 4 are inconsistent because of the repeated eigenvalue so how do I go about this? 

Models.pdf (0,3 MB)

1 Answer

+3 votes
answered Apr 30, 2017 by Yaseen (650 points)
selected May 9, 2017 by Rowan
Best answer

Your issue can be resolved by referring to the hint given in the question. The diagonalisation method only leads to a general formula for the transition probabilities for n>0, due to the zero eigenvalue. As a result, equations 1 and 3 in your answer are irrelevant. You can then notice that the formulae for the transition probabilities are simply constant for n>0.