The Gorman Manufacturing Company must decide whether to manufacture a component part at its Milan, Michigan, plant or purchase the component part from a supplier. The resulting profit is dependent upon the demand for the product. The state-of-nature probabilities are P(s_1 )= 0.35, P(s_2 )= 0.35, and P(s_3 )= 0.30.

The following payoff table shows the projected profit (in thousands of dollars):

\fDecision State of Nature Alternative Low Demand Medium High Demand 51 Demand Sa S- Manufacture, d, -20 40 100 Purchase, d, 10 45 70