A small manufacturing company produces a single product and faces uncertain demand. Before knowing the actual demand, the company must decide how many units to produce in advance at a cost of 10 pounds per unit. Once demand is revealed, if the initial production is insufficient, the company can produce additional units at a higher cost of 15 pounds per unit. The company wants to minimize its expected total cost. Demand is uncertain and can take two possible values: either 100 units with probability 0.4 or 200 units with probability 0.6. The company must choose its initial production quantity before demand is known. After demand is realized, if the initial production is less than the actual demand, the company will produce the shortfall at the higher cost. There is no penalty for producing more than demand, but excess units have no value. For example, if the company produces 120 units initially and demand turns out to be 100 units, the total cost is 1,200 pounds, and no additional production is needed. If demand turns out to be 200 units, the company will need to produce 80 extra units at 15 pounds each, adding 1,200 pounds to the cost, for a total of 2,400 pounds. The goal is to choose the initial production quantity that minimizes the expected cost across the two demand scenarios.