You just finished a week of heli-skiing and had such a good time that you want to go again next year. Plus, the heli-ski outfit is offering the following deal: If you pay for your vacation now, you can get a week of heli-skiing for $2,500. 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 20% probability that you will not be able to ski. Your other option is to wait and book the trip one week before you go. The heli-ski company requires a minimum of one week advanced booking. In this case, your cost is $5,000, but you can be much more certain about the conditions, your health and the weather. Now, the probability that you will not be able to ski is only 5%. In either case, you estimate the pleasure you get from heli-skiing is worth $6,000. If your cost of capital is 8% per year, should you book ahead or wait?