Crop production is attracting investment in Grafton Shire. A farmer needs to decide what she is going to produce for the next season. There are four possible crops she could grow in her 1,000 acres of land and three possible states of nature with different outcomes that are summarised in Table 1.

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Table 1. Payoff Table for Different Crops (Payoff Expressed in AUD per acre). States of nature Alternative 1- Barley Alternative 2 - Canola Alternative 3 - Maize Alternative 4 - Wheat Dry 500 200 300 -200 Mild 200 400 300 100 Wet -400 -200 -100 300 Table 1. Payoff Table for Different Crops (Payoff Expressed in AUD per acre). States of nature Alternative 1- Barley Alternative 2 - Canola Alternative 3 - Maize Alternative 4 - Wheat Dry 500 200 300 -200 Mild 200 400 300 100 Wet -400 -200 -100 300

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a Maximin and maximax criterion Maximin Wheat 200 1... View the full answer