is that q is 0.4545 and gross present value is 27.17K?

. . Holiday Inns is considering building a new hotel in Guangzhou on a piece of land that Holiday Inns owns. Guangzhou is a candidate to host the East Asian Games 2 years from now. If Guangzhou indeed gets chosen as the host, the market value of a new hotel at 2 years from now will be about $200 million. Otherwise, its market value at 2 years from now will only be about $100 million Its present market value is estimated to be $125 million The Fast Construction Corp. (FCC) offers to build such a hotel for a cost of $120 million. Holiday Inns has to decide whether or not to accept the offer now. For simplicity, assume that the full payment will be made at 2 years from now. Table brenomeat Tree Gebetsly Tree . . On the other hand, Holiday Inns can wait until the announcement regarding which city will be hosting the East Asian Games (the announcement will be made 6 months from now). FCC anticipates that Holiday Inns might cancel the building project if the East Asian Games goes to another city. Thus, to compensate for the profit the FCC would miss if the building project is cancelled, FCC asks Holiday Inns for an immediate payment of $12 million. After this payment is made, FCC will be willing to build a hotel for Holiday Inns for $120 million. (The $120 million will be paid by Holiday Inns to FCC at 2 years from now.) Assume the risk-free interest rate is 5%. As a chief officer of corporate strategy for Holiday Inns, advise the CEO of Holiday Inns what to do. Justify your answer with analysis and numbers. . . Holiday Inns is considering building a new hotel in Guangzhou on a piece of land that Holiday Inns owns. Guangzhou is a candidate to host the East Asian Games 2 years from now. If Guangzhou indeed gets chosen as the host, the market value of a new hotel at 2 years from now will be about $200 million. Otherwise, its market value at 2 years from now will only be about $100 million Its present market value is estimated to be $125 million The Fast Construction Corp. (FCC) offers to build such a hotel for a cost of $120 million. Holiday Inns has to decide whether or not to accept the offer now. For simplicity, assume that the full payment will be made at 2 years from now. Table brenomeat Tree Gebetsly Tree . . On the other hand, Holiday Inns can wait until the announcement regarding which city will be hosting the East Asian Games (the announcement will be made 6 months from now). FCC anticipates that Holiday Inns might cancel the building project if the East Asian Games goes to another city. Thus, to compensate for the profit the FCC would miss if the building project is cancelled, FCC asks Holiday Inns for an immediate payment of $12 million. After this payment is made, FCC will be willing to build a hotel for Holiday Inns for $120 million. (The $120 million will be paid by Holiday Inns to FCC at 2 years from now.) Assume the risk-free interest rate is 5%. As a chief officer of corporate strategy for Holiday Inns, advise the CEO of Holiday Inns what to do. Justify your answer with analysis and numbers