Please refer to document attached.
1a) Discuss among the two alternatives proposed by Axel, which one NewCrest will choose.
Please write clearly alternatives, states of nature and payoffs in a payoff table. Please limit
the answer to within one page.
1b) Please search online “tricks to maximize the min of objective functions” or
“transformations into linear programs”. Then help Ben develop a complete Linear
Programming (LP) model that represents the problem of deciding how much to invest in
each option. Please limit the answer to within one page.
1c)Use the Excel Solver to find the optimal solution to the problem in Part (b) and summarise
how NewCrest should invest.
Please paste here three screenshots:
(1) the problem worksheet just before clicking the Solver command,
(2) the Solver Parameters dialog just before clicking Solve and
(3) the Answer Report created by the Solver. Please limit the answer to within three
pages.
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