Consider how Golden Valley, a popular ski resort, could use capital budgeting to decide whether the $8.5 million Auturrin Park Lodge expansion would be a good investment. (Click the loon to view the expansion estimates.) (Click the icon to view the present value annuity factor table.) (Click the icon to view the present value factor table. (Click the icon to view the future value annuity factor table.) (Click the icon to view the future value factor table.) Read the requirements. Requirement 1. What is the project's NPV? Is the investment attractive? Whwor why not? Calculate the net present value of the expansion. (Round your answer Requirements Net present value expansion X 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? Print Done 1 Consider how Golden Valley, a popular ski resort, could use capital budgeting to decide whether the $8.5 million Auturin Park Lodge expansion would be a good investment (Click the loon to view the expansion estimates.) (Click the icon to view the present value annuity factor table.) (Click the icon to view the future value annuity factor table.) Data Table Read the requirements. Assume that Golden Valley's managers developed the following Requirement 1. What is the project's NPV? Is the investment attractive? WH estimates concerning a planned expansion to its Autumn Park Lodge (all numbers assumed): Calculate the net present value of the expansion. (Round your answer to the Number of additional skiers per day........ 125 Net present value expansion Average number of days per year that weather conditions allow skiing at Golden Valley ...... 164 Useful life of expansion (in years) ............ 8 Average cash spent by each skier per day.......... $ 239 Average variable cost of serving each skier per day . $ 138 Cost of expansion...... Discount rate 12% Assume that Golden Valley uses the straight-line depreciation method and expects the lodge expansion to have a residual value of $750,000 at the end of its eight-year life. It has already calculated the average annual net cash inflow per year to be $2,070,500. ......... $ 8,500,000 Print Done Consider how Golden Valley, a popular ski resort, could use capital budaatin to decide whether the $8.5 million Aututia Park Lodge expansion would be a good investment. (Click the loon to view the expansion estimates.) (Click the icon to view the present value annuity factor ta Reference ( Click the icon to view the future value annuity factor tab Read the requirements. . Present Value of Annuity of $1 Periods 1% 2% 3 3% 4% 5% 6% 3% 10% 12% % 5 6 8 14% 16% 18% 20% % % % Perlod 1 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.909 0.893 0.877 0.862 0.847 0.833 1 Requirement 1. What is the project's NPV? Is the investmer Period 2 1.970 1.942 1913 1.986 1.859 1.833 1.783 1.736 1.850 1.847 1.805 1.568 1.528 Period 3 3 2.941 Calculate the net present value of the expansion. (Round yo 2.894 2.829 2.775 2.723 2673 2 577 2.487 2.402 2.322 2246 2.17 2.106 Period 4 3.902 3.808 3717 3.630 3.546 3.4653 312 3.170 3.037 2.914 2.798 2.890 2.589 Period 5 4.9534.713 4.590 4.452 4.329 4.212 3.993 3.791 3.605 3.433 3.274 3.127 2.991 Net present value of expansion Perlod 6 5.795 5.601 5.417 5.242 5.076 4.917 4623 4.355 4.111 3.889 3.685 3.498 3.926 Period 7 6.728 8.472 6.230 6.002 5.788 5.582 5208 4.968 4.564 4.268 4.035 3.012 3.805 Period 8 7.652 7.325 7.020 6.733 6.463 6.210 5.747 5.335 4.968 4.639 4344 4.078 3.837 Period 9 8.566 8.162 7.788 7.435 7.108 6.8026247 5.759 5.328 4.946 4,946 4607 4.306 4,031 Period 10 9.471 8.993 8630 8.111 7.722 7.360 7.722 7.360 6.710 6.145 5.6505.216 4.833 4.484 4.192 Period 11 | 10.368 9.787 9.253 8.760 8.306 7.887 7.139 6.495 5.938 5.453 5.029 4.656 4.927 Period 12 11.255 10.575 9.954 9.385 0.883 8.384 7.536 6.914 6.154 5.660 5.197 4.796 4.439 Perlod 13 12.134 11.348 10.635 9.986 9.394 8.8537.904 7.103 6.424 5.842 5.342 4.910 4.503 Period 14 13.004 12.106 11.298 10.563 9.899 9.2958244 7.367 6.628 6.002 5.488 5.006 4611 Period 15 13.865 12.849 11.909 11.118 10.390 9.7128.559 7.606 6.811 6.142 5.575 5.092 4.675 period 20 18.046 16.351 14.877 13.590 12.452 11.4709818 8.514 7.49 6.623 5.9295.353 4.870 Period 25 22.023 19.523 17.413 15.622 14.094 12.793 10.675 9.077 7.8436.973 6.973 6.097 5.467 4.948 Period 30 25.808 22.396 19600 17.292 15.372 13.765 11.258 9.427 8.055 7.003 7.003 6.177 5.517 4.979 Period 40 52.035 27.356 23.115 19.790 17.159 15.048 11.925 9.779 8.244 7.105 6233 5.548 4.997 Print Done Consider how Golden Valley, a popular ski resort, could use capital budaatinsa to decide whether the $8.5 million Awturin Park Lodge expansion would be a good investment. (Click the loon to view the expansion estimates. (Click the icon to view the present value annuity Reference (Click the icon to view the future value annuity ta Read the requirements. . Future Value of Annuity of $1 Periods 1% 2% 3% 4% 5% 6% 3% 10% 12% 2% 3 8% % 14% 16% 18% 20% Period 1 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Requirement 1. What is the project's NPV? Is the in 1.000 Period 2 2010 2.020 2030 2.040 2050 2.060 2.000 2.100 2.120 2.140 2130 2.180 2.200 Period 3 3.030 3.060 3.091 3.122 Calculate the net present value of the expansion. (R 3.153 3.184 3.246 3.310 3.374 3.440 3506 3.572 3.640 Period 4 4.050 4.122 4.184 4.248 4.310 4.375 4.506 4.641 4.779 4.921 5056 5.215 5.368 Period 5 5.101 5.204 5.309 5.418 Net present value of expansion 5.526 5.637 5.867 6.105 6.353 6.610 6.877 7.154 7.442 Period 6 6.152 6.308 6.468 6.633 68026.975 7.336 7.716 8.115 8.536 8.977 9.442 9.930 Period 7 7.214 7.434 7.682 7.890 8.142 8.394 8.923 9.487 10.069 10.730 11.414 12.142 12.516 Period 8 8.286 8.583 8.892 9.214 9.549 9.897 10637 11.436 12.300 13.233 14.240 16.499 Period 9 9.339 9.755 10.159 10.583 11.027 11.491 12488 13.579 14.776 16,085 17.519 19.088 20.799 Period 10 10.462 10.950 10.452 10.950 11.464 12 006 12578 13.181 14.407 15.907 17.549 19.337 21.321 23.521 25.959 11.567 12.169 12.808 13.486 14 207 14.972 16.645 18.531 20.655 23.045 25.733 28.755 32.150 Period 12 12693 13.412 14.192 15.028 15,917 19.870 18.977 21.384 24.133 27.271 30.850 34.931 39.581 Period 13 13.809 14.680 15.68 16627 17.713 18.882 21495 24.523 28.029 32.089 36.786 42.219 48.497 Period 14 14.947 15.974 17.006 18292 19599 21.015 24.215 27.975 32.353 37.581 43.872 50.810 59.198 Period 15 16.097 17.293 18.599 20.024 21.579 23.276 27.152 31.772 37.220 43.842 51.660 60.965 72.036 Period 20 22019 24.297 26.870 29.778 33,066 35.785 45.762 57.275 72.052 91.025 115390 146.628 185.688 Period 25 28 243 32.000 36.459 41.646 47.727 54.865 73.106 98.347 133.334 181.871 249.214 342.603 471.981 Period 30 34.785 40.568 47.575 56.085 66.43979.058 113283 164.494 241.383 358.787 530.312 790.948 1,181.882 Period 40 48.896 60.402 75.401 95.028 120.000 154.762 259.057 442.593 767.091 1.342.025 2.360.757 4,163 213 7.343.859 15.327 Period 11 Print Done Consider how Golden Valley, a popular ski resort, could use capital budasting to decide whether the $8.5 million Autumn Park Lodge expansion would be a good investment. (Click the loon to view the expansion estimates.) (Click the icon to view the present value annuity fad 2x Reference Click the icon to view the future value annuity facto Read the requirements. . Future Value of $1 Periods 1% 2% 2 3 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% 5 % 8 . % % Perlod 1 1.010 1.020 1.030 Requirement 1. What is the project's NPV? Is the inves 1040 1.050 1.060 1.080 1.100 1.120 1.140 1.160 1.180 1.200 Period 2 1.020 1.040 1.061 1.092 1.103 1.124 1.1861210 1.254 1.300 1.348 1.392 1.440 Period 3 1.030 1.051 Calculate the net present value of the expansion. (Rour 1.098 1.125 1.158 1.191 1.260 1.331 1.405 1.482 1.561 1.643 1.728 Period 4 1.041 1.082 1.126 1.170 1.216 1.262 1.360 1.484 1.574 1.689 1.811 1.939 2.074 Period 5 1.051 Net present value of expansion 1.104 1.159 1217 1.276 1.338 1.469 1.611 1.762 1.925 2.100 2.288 2.488 Perlod 6 1.062 1.126 1.194 1255 1.340 1.419 1.587 1.772 1.974 2.195 2.438 2.700 2.986 Period 7 1.072 1.149 1.230 1316 1.407 1.504 1.714 1.949 2211 2 502 2.828 3.105 3.583 Periods 1.083 1.172 1.267 1.369 1.594 1.851 2144 2.476 2853 3.278 3.750 4.300 Period 9 1.094 1.195 1.305 1423 1.561 1.589 1.999 2358 2.773 3252 3.803 4435 5.160 Period 10 1.105 1.219 1.344 1.490 1.629 1.791 2.159 2594 3.106 3.707 4.411 5.234 6.192 Period 11 1.116 1.243 1.384 1.539 1.710 1.898 2.332 2853 3.479 4226 5.117 6.176 7.430 Period 12 1.127 1.289 1.428 1.601 1.798 2.012 2.518 3.138 3.893 4.818 5.90 7.288 9.916 Period 13 1.138 1.294 1.469 1.665 1.888 2.133 2.720 3.452 4.363 5.492 6.898 8.599 10.699 Period 14 1.149 1.319 1.513 1.732 1.580 2.261 2.937 3.797 4.887 6231 7.988 10,147 12.839 Period 15 1.161 1.346 1.568 1.801 2.079 2.397 3.172 4.177 5.474 7.138 9.268 11.974 15.407 Period 20 1.220 1.806 2.191 2.653 3.207 4.561 6.727 9.646 13.745 13.743 19.461 27.353 38.338 Period 25 1.282 2.094 2.666 3.388 4.292 6.848 10.835 17.000 26.462 40.874 62.669 95.393 Period 30 1.348 1.811 2.427 3243 4.322 5.743 10.063 17.449 29.950 50.950 85.850 143.371 237.378 Period 40 1.489 2.209 3.262 4.801 7.040 10.288 21.725 45.259 93.051 168.994 370.721 750.378 1.489.772 1.477 1.488 Print Done