Rita McCormick is the supervisor of the state office that processes sales tax payments. She has noticed that workers are falling behind and wants to get authorization either to hire two more employees or to schedule overtime until the work gets caught up. McCormick estimates that there is an 80 percent chance the workload will continue to be this high and a 20 percent chance that work will fall back to previous levels, which the current employees can handle during regular working hours. (She assumes there is no chance of less work in the future.) Because she will have to pay time and a half for overtime, she assumes that the annual cost of overtime will be $150,000, whereas a work force with two more employees will cost only $140,000.
Which alternative should the supervisor choose?
