Consider how Clare Valey, a popular ski resort, covild use capital budgeting to decide whether the 58.5 millian River Park Lodge axpansion would be a good inmestment IClisk the icon to vew thit expansion nstimates.) (Click the loon to view the prosent value annulty faciar table.) (Cick the loon to viow the presont value tactor tacies) (Cick the icon to view tha fulure value annuity factor table.) (Cick the icon to vens ine Afure value factor table) Resd the reguisments. Requirement 1. What is the projecri NPY? Is the investment attractive? Why or why not? Net present yaves of 6kpasion Data table Assume that Clare Valley's managers developed the following estimates concerning a planned expansion to its River Park Lodge (all numbers assumed): Number of additional skiers per day .............. 117 Average number of days per year that weather conditions allow skiing at Clare Valley ............ 157 Useful life of expansion (in years) Average cash spent by each skier per day........\$ 238 Average variable cost of serving each skier per day $134 Cost of expansion........................... $8,500,000 Discount rate........................... 10% Assume that Clare Valley uses the straight-line depreciation method and expects the lodge expansion to have a residual value of $1,000,000 at the end of its nine-year life. It has already calculated the average annual net cash inflow per year to be $1,910,376. Reference Present Value of Annuitv of $1 Reference Reference Reference Requirements 1. What is the project's NPV? Is the investment attractive? Why or why not? 2. Assume the expansion has no residual value. What is the project's NPV? Is the investment still attractive? Why or why not