Consider a risky portfolio. The end$-$of$-$year cash flow derived from the portfolio will be either $$80,000$ or $$205,000,$ with equal probabilities of $0\mathrm{.}5.$ The alternative riskless investment in T$-$bills pays $5\%.$

Required:

a$.$ If you require a risk premium of $10\%,$ how much will you be willing to pay for the portfolio?