Kang 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 :High$-600$ Medium$-600$ Low$-550$

Outside vendor: High$-850$ Medium$-550$ Low$-250$

Combination: High$-750$ Medium$-600$ Low$-450$

$($a$)$

If the demand probabilities are $0\mathrm{.}2,0\mathrm{.}5,$ and $0\mathrm{.}3,$ which decision alternative will minimize the expected cost of the data processing operation? What is the expected annual cost associated with that recommendation? $($Enter your answers in dollars.$)$

EV$($Own staff$)=$ $

EV$($Outside vendor$)=$ $

EV$($Combination$)=$ $