Consider how Golden Valley, a popular ski resort, could use capital budgeting to decide whether the S10.5 million Brook Park Lodge expansion would be a good investment (Cock the icon to view the expansion estimates) (Click the icon to view the prosent value annuity tactor table) (Click the icon to view the present value tactor tatlo) (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 attractivo? Why or why not? Calculate the net present value of the expansion (Round your answer to the nearest whole dollar Uso parenthesos or a minus sign for a negative net present value) Net present value of expansion Data Table Assume that Golden Valley's managers developed the following estimates concerning a planned expansion to its Brook Park Lodge (all numbers assumed) Number of additional skiers per day.... 121 Average number of days per year that weather conditions allow skiing at Golden Valley 162 Useful life of expansion (in years). 10 Average cash spent by each skier per day. $ 244 Average variable cost of serving each skier per day . $ 132 Cost of expansion... $ 10,500,000 Discount rate. 14% 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 ten-year life. It has already calculated the average annual net cash inflow per year to be $2,195,424 ---- Reference Present Value of Annuity of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% Period 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 Period 2 1.970 1942 1913 1.886 1.859 1833 1783 1736 1.690 1.647 1.605 1.566 1.528 Period 3 2.941 2.884 28292775 2.723 2.673 2577 2.487 2.402 2.322 2.246 2 174 2106 Period 4 3.902 3.808 3.717 3.630 3.546 3.465 3.312 3.170 3.037 2.914 2.798 2.690 2.589 Period 5 4.853 4.713 4.5804452 4.32942123.993 3.791 3.605 3.433 3.274 3 127 2.991 Period 6 5.795 5.601 5.417 5.2425.0764.917 4.623 4.355 4.111 3.8893.685 3.498 3.326 Period 7 6.728 6.472 6.230 6.0025.786 5.582 5206 4.868 4.564 4.288 4.039 3.812 3.605 Period 8 7.6527325 7,020 6.733 6.463 6210 57475.335 4.968 4.639 4.344 4.078 3.837 Period 9 8 566 8.1627 786 7435 7 108 6.8026.247 5.759 5328 4.946 4.607 4.303 4031 Period 10 9.471 8.983 | 8530 8. 111 7.7227 360 6.710 6.145 5.6505.216 4.833 4.494 4.192 Period 11 10.368 9.787 9.253 8.760 8.3067.887 7.139 6.495 5.9385.453 5.029 4.656 4.327 Period 12 11 255 10575 9.95493858.863 8.38475366.814 6.194 5.660 5.197 4.793 4.439 Period 13 12 134 11.348 10.6359.986 9.3948.853 7904 17 103 6.424 5.842 5.342 4.910 4.533 Period 14 13.004 12 106 11 298 10.563 9.899 9.295 8.24473676.628 6.0025.468 5.008 4.611 Period 15 13.865 12 849 11938 11.11810.380 9.7128.5597.606 6.811 6.142 5.575 5.092 4.675 Period 20 18.046 16.351 14.877 13.590 12.462 11.470 9.818 8.514 7.4696.623 5.929 5.353 4.870 Period 25 22.023 19523 17.413 15.622 14.094 12783 10,675 9.077 7.843 6.873 6.097 5.467 4.948 Period 30 25 808 22 396 19.600 17.292 15.372 13.765 11 25894278.055 7.003 6.177 5.517 4.979 Period 40 32 835 27 355 23.115 19.793 17 159 15.046 11.925 9.779 8 244 7.105 6.233 5,548 4.997 Periods Period 1 Period 2 Period 3 Period 4 Period 5 7336 Period 6 Period 7 Period 8 Period 9 Period 10 Future Value of Annuity of S1 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20% 1.000 1.000 1.000 1.000 1000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 2010 2.020 2.030 2.040 2.050 2060 2080 2.100 2.120 2.140 2 160 2. 180 2 200 3.030 3.060 3.091 3.122 3.153 3.184 3.246 3.310 3.374 3.440 3.506 3.572 3.640 4.060 4.122 4.184 4.246 4.310 4.375 4.506 4.641 4.779 4.921 5.066 5.215 5.368 5.101 5.204 5.309 5416 5.526 5.637 5.867 6.105 6.353 6.610 6.877 7.154 7.442 6.152 6308 6.468 6.633 6.802 6.975 7.716 8. 115 8,536 8.977 9.442 9930 7214 7.434 7.662 7 898 8.142 8.394 8.923 9.487 10 089 10.730 11.414 12.142 12.916 8.286 8.583 8 892 9214 9.549 9.897 10.637 11.436 12.300 13.233 14.240 15 327 16.499 9.369 9.755 10.159 10.583 11.027 11.49112 488 13.579 14.776 16.085 17 519 19.086 20.799 10 462 10.950 11.464 12 006 12.578 13.181 14.48715.93717.549 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 1268313 412 14 192 15.026 15.917 16.870 18.977 21 384 24.133 27 271 30 850 34 931 39 581 13.809 14.680 15.618 16 62717 713 18.882 21.495 24,523 28 029 32.089 36.786 42219 48.497 14.94715.97417 086 18.292 19.599 21015 24 215 27.975 32 393 37 581 43.672 50.818 59.196 16.097 17 293 18.599 20.024 21:579 23.276 27 152 31 772 37 280 43.842 51 660 60.965 72.035 22.019 24 297 26.870 29.778 33.066 36.786 45.762 57 275 72.052 91 025 115 380 146.628 186 688 28 243 32 030 36.459 41.646 47.727 54,865 73.106 98.347 133.334 181.871 249.214 342.603 471.981 34.785 40.568 47.575 56.085 66 439 79.058 113.283 164.494 241.333 356.787 530 312 790.948 1.181.882 48 886 60 402 75.401 95026 120 800 154 762 259.057 442 593 767 091 1,342 025 2,360.757 4,163 213 7 343 858 Period 11 Period 12 Period 13 Period 14 Period 15 Period 20 Period 25 Period 30 Period 40 Present Value of $1 6% 18% Periods 1% 2% Period 1 0.990 0.980 Period 2 0.9800.961 Period 3 0.971 0.942 Period 4 0.961 0.924 Period 5 0.951 0.906 Period 6 0.942 0 888 Period 7 0.933 0.871 Period 8 0.923 0.853 Period 9 0.914 0.837 Period 10 0.905 0.820 3% 4% 5% 0.971 0.962 0.952 0.943 0.925 0.907 0.915 0.889 0.864 0.888 0.855 0.823 0.863 0.822 0.784 0.943 0.890 0.840 0.792 0.747 8% 0.926 0.857 0.794 0.735 0.681 10% 0.909 0.826 0751 0.683 0.621 12% 14% 0 893 0.877 0.797 0.769 0.712 0675 0.636 0.592 0.567 0.519 16% 0.862 0.743 0.641 0.552 0.476 0.847 0.718 0.609 0.516 0.437 20% 0.833 0.694 0.579 0.482 0.402 0.837 0.813 0.789 0.766 0.744 0.790 0.746 0.705 0.760 0.711 0.665 0.731 0,677 0.627 0.703 0.645 0.592 0.676 0.614 0.558 0.630 0.583 0.540 0.500 0.463 0.564 0513 0.467 0.424 0.386 0.507 0 452 0.404 0.361 0.322 0.456 0.400 0.351 0.308 0.270 0.410 0.354 0.305 0.263 0227 0.370 0.314 0 266 0.225 0.191 0.335 0.279 0.233 0 194 0.162 Period 11 0.896 Period 12 0.887 Period 13 0.879 Period 14 0.870 Period 15 0.861 0.804 0.788 0.773 0.758 0.743 0.722 0.701 0.681 0.661 0.642 0.650 0.625 0.601 0.577 0.555 0585 0.557 0.530 0 505 0.481 0.527 0.497 0.469 0.442 0.417 0.429 0.397 0.368 0.340 0.315 0.350 0.319 0.290 0.263 0.239 0.287 0.257 0.229 0.205 0.183 0.237 0208 0.182 0 160 0.140 0.195 0.168 0.145 0.125 0.108 0.162 0.135 0.137 0 112 0.116 0.093 0.099 0.078 0.084 0.065 Period 20 0.820 Period 25 0.780 Period 30 0.742 Period 40 0.672 0.673 0.610 0552 0.453 0.554 0.478 0412 0307 0.456 0.377 0.312 0.375 0.295 0.233 0 308 0.231 0.174 0.2080142 0.097 0.215 0.149 0.146 0.092 0.099 0.057 0.046 0.022 0.104 0.059 0.033 0.011 0.073 0.038 0.020 0.005 0.051 0.024 0.012 0.003 0.037 0.016 0 007 0.001 0.026 0.010 0.004 0.001 Future Value of $1 Periods Period 1 Period 2 Period 3 Period 4 Period 5 1% 1.010 1.020 1.030 1.041 1.051 2% 1.020 1.040 1.061 1.082 1.104 3% 1.030 1.061 1.093 1.126 1.159 4% 1.040 1.082 1.125 1.170 1.217 5% 1.050 1.103 1.158 1.216 1.276 Period 6 Period 7 Period 8 Period 9 Period 10 1.062 1.072 1.083 1.094 1.105 1.126 1.149 1.172 1.195 1.219 1.194 1 230 1.267 1305 1.344 1.265 1.316 1.369 1.423 1.480 1 340 1.407 1.477 1.551 1.629 6% 8% 10% 12% 14% 16% 18% 20% 1.060 1.080 1.100 1.120 1.140 1.160 1 180 1.200 1.124 1.166 1.210 1.254 1.300 1.346 1.392 1.440 1.191 1.260 1.331 1.405 1.482 1.561 1.643 1.728 1.262 1360 1.464 1.574 1.689 1.811 1939 2.074 1.338 1.469 1.611 1.762 1.925 2.100 2.288 2.488 1.419 1.587 1772 1974 2.195 2436 2.700 2.986 1.504 1.714 1.949 2.211 2.502 2826 3.185 3.583 1.594 1.851 2.144 2.476 2.853 3.278 3.759 4300 1.689 1 999 2358 2.773 3.252 3.803 4.435 5.160 1.791 2.159 2.594 3.106 3.707 4.411 5.234 6.192 1.898 2332 2853 3.479 4.226 5.117 6.176 7430 2012 2.518 3.138 3.896 4.818 5.936 7288 8.916 2.133 2.720 3.452 4.363 5.492 6.886 8.599 10.699 2.261 2 937 3.797 4887 6.261 7.988 10.147 12.839 2.397 3.172 4.177 5 474 7.138 9.266 11.974 15.407 3.207 4.661 6.727 9.646 13.743 19.461 27.393 38.338 4.292 6.848 10.835 17.000 26.462 40.874 62.669 95 396 5.743 10.06317449 29.960 50 950 85.850 143,371 237,376 10 286 21.725 45.25993.051 188.884 378.721 750.3781,469.772 Period 11 Period 12 Period 13 Period 14 Period 15 1.116 1.127 1.138 1.149 1.161 1.243 1.268 1.294 1.319 1 346 1.384 1.426 1.469 1.513 1.558 1539 1.601 1.665 1.732 1.801 1.710 1.796 1.886 1.980 2079 Period 20 Period 25 Period 30 Period 40 1.220 1282 1.348 1489 1.486 1.641 1.811 2208 1.806 2094 2427 3.262 2.191 2 666 3243 4.801 2.653 3.386 4.322 7.040 X 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