Consider how Golden Valley, a popular ski resort, could use capital budgeting to decide whether the $9 million Waterfall Park Lodge expansion would be a good investment. (Click the icon to view the expansion estimates.) (Click the icon to view the (Click the icon to view the f Read the requirements. Data table ple.) e.) Requirement 1. What is the pr Calculate the net present value Net present value of expansion Is the investment attractive? W The expansion is Requirement 2. Assume the ex Calculate the project's NPV. (R Net present value of expansion Assume that Golden Valley's managers developed the following estimates concerning a planned expansion to its Waterfall Park Lodge (all numbers assumed): Number of additional skiers per day..... Average number of days per year that weather conditions allow skiing at Golden Valley ... Useful life of expansion (in years)..... 125 us sign for a negative net present value.) 157 10 Average cash spent by each skier per day........ Average variable cost of serving each skier per day . $ Cost of expansion... Discount rate. $ 239 134 $ 9,000,000 14% Why or why not? net present value.) Assume that Golden Valley uses the straight-line depreciation method and expects the lodge expansion to have a residual value of $950,000 at the end of its ten-year life. It has already calculated the average annual net cash inflow per year to be $2,060,625. Requirement 1. What is the project's NPV? Is the investment attractive? Why or why not? Calculate the net present value of the expansion. (Round your answer to the nearest whole dollar. Use parentheses or a minus sign for a negative net present value.) Net present value of expansion Is the investment attractive? Why? The expansion is project because its NPV is Requirement 2. Assume the expansion has no residual value. What is the project's NPV? Is the investment still attractive? Why or why not? Calculate the project's NPV. (Round your answer to the nearest whole dollar. Use parentheses or a minus sign for a negative net present value.) Net present value of expansion Is the investment attractive? Why? Without a residual value, the expansion because of the project's NPV