It is the beginning of September and you have been offered the following

deal to go heli-skiing. If you pick the first week in January and pay for your

vacation now, you can get a week of heli-skiing for $2,800. However, if you

cannot ski because the helicopters cannot fly due to bad weather, there is

no snow, or you get sick, you do not get a refund. There is a 50%

probability that you will not be able to ski. If you wait until the last minute

and go only if you know that the conditions are perfect and you are well,

the vacation will cost you $4,600. You estimate that the pleasure you get

from heli-skiing is worth $7,300 per week to you (if you had to pay more

than that, you would choose not to go). If your cost of capital is 13% per

year, should you book ahead or wait?