Question: udson Corporation is considering three options for managing its data processing operation: continuing with its own staff, hiring an outside vendor to do the managing

udson Corporation is considering three options for managing its data processing operation: continuing with its own staff, hiring an outside vendor to do the managing (referred to as outsourcing), or using a combination of its own staff and an outside vendor. The cost of the operation depends on future demand. The annual cost of each option (in thousands of dollars) depends on demand as follows:
Demand
Staffing Options High Medium Low
Own staff 650650600
Outside vendor 900600300
Combination 800650500
If the demand probabilities are 0.2,0.5, and 0.3, which decision alternative will minimize the expected cost of the data processing operation?

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