The Gorman Manufacturing Company must decide whether to manufacture a component part at its plant or purchase the component part from a supplier. The resulting profit is dependent upon the demand for the product. The following payoff table shows the projected profit (in ten thousand of pesos):   state of nature state of nature state of nature Decision Alternative Low Demand S1 Medium

The Gorman Manufacturing Company must decide whether to manufacture a component part at its plant or purchase the component part from a supplier. The resulting profit is dependent upon the demand for the product. The following payoff table shows the projected profit (in ten thousand of pesos):

The state-of-nature probabilities are P(s1 ) = 0.35, P(s2 ) = 0.35, and P(s3) = 0.30.

A test market study of the potential demand for the product is expected to report either a favorable (F) or unfavorable (U) condition. The relevant conditional probabilities are as follows:

P (F| S1) = 0.10            P (U|S1)=0.90

P (F| S2) = 0.40            P (U|S2)=0.60

P (F| S3) = 0.60            P (U|S3)=0.40

A. What is XY Manufacturing Company optimal decision strategy? 
B. What is the expected value of the market research information? 
C. What is the efficiency of the information?