Paul Harrid, president of Crane Always, agrees to construct a concrete cart path at Waterway Golf Club. Crane Always enters into a

contract with Waterway to construct the path for $$195,000.$ In addition, as part of the contract, a performance bonus of $$46,800$ will

be paid based on the timing of complation. The performance bonus will be paid fully if complated by the agreed$-$upon date. The

performance bonus decreases by $$11,700$ per wesk for every wesk beyond the agresd$-$upon complation date. Paul has bean involwed

in a number of contracts that had performance bonuses as part of the aseement in the past. As a result, he is fairly confident that he

will receive a good portion of the performance bonus. Paul estimates, given the constraints of his schedule related to other joba, that

there is $60\%$ probability that he will complete the project on time, a $30\%$ probability that he will be $1$ weak late, and a $10\%$ probability

that he will be $2$ weels late.

$($a$)$

$$ Your answer is correct.

Determine the traneaction price that Crane Always should compute for this aseament.

Transaction price

$

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$($b$)$

Assume that Paul Harrid has reviewed his work schedule and decided that it malkes sense to complete this project on time.

Assuming that he now believes that the probability for complating the project on time is $95\%$ and otherwise it will be finished $1$

wesk late, determine the transaction price.