How do you solve part 2?

Problem 26-03 Investment Timing Option: Decision-Tree Analysis Hart Lumber is considering the purchase of a paper company which would require an initial investment of $280 million. Hart estimates that the paper company would provide net cash flows of $33.6 million at the end of each of the next 20 years. The cost of capital for the paper company is 11%. a. Should Hart purchase the paper company? No b. Hart's best guess is that cash flows will be $33.6 million a year, but it realizes that the cash flows are as likely to be $28 million a year as $39.2 million. One year from now, it will find out whether the cash flows will be $28 million or $39.2 million. In addition, Hart could sell the paper company at Year 3 for $266 million. Given this additional information, does decision-tree analysis indicate that it makes sense to purchase the paper company? Again, assume that all cash flows are discounted at 11% No, it makes sense to wait one year before deciding whether to make the acquisition. *