Consider how Star Valley, a popular ski resort, could use capital budgeting to decide whether the $9 million Snow Park Lodge expansion would be (Click the icon 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? 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 not Net present value of expansion S 1.177.450 Is the investment attractive? Why? The expansion is an attractive project because its NPV is positive 6 Requirement 2. Assume the expansion has no residual value. What is the project's NPV? Is the investment salt attractive? Why w 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 -ojed Assume that Star Valley's managers developed the following estimates concerning a planned expansion to its Snow Park Lodge (all numbers assumed): . $ Number of additional skiers per day 124 Average number of days per year that weather conditions allow skiing at Star Valley 163 Useful life of expansion (in years) 10 Average cash spent by each skier per day.. 237 Average variable cost of serving each skier per day $ 142 Cost of expansion.. $ 9,000,000 Discount rate..... 14% Assume that Star Valley uses the straight-line depreciation method and expects the lodge expansion to have a residual value of $600,000 at the end of its ten-year life. It has already calculated the average annual net cash inflow per year to be $1,920,140. 6% Present Value of Annuity of $1 Periods 1% 2% 3% 4% 5% 8% 10% 12% 14% 16% 18% 20% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.9090.893 0.877 0.862 0.847 0.833 Period 2 1.970 | 1.942 1.913 1.886 1.859 1.833 1.783 1.736 1.690 1.647 1.605 1.566 1.528 Period 3 2.941 2884 2.8292775 2.723 2673 2.677 2487 2402 2.322 2246 2.174 2106 Period 4 3.902 3.808 3.7173.630 3.546 3.465 3.312 3.170 3.037 2.914 2.798 2.690 2589 Period 5 4.853 4713 4.680 4.452 4.3294212 3.993 3.791 3.605 3.433 3.274 3.127 2.991 Period 6 5.795 5.601 5.417 52425.0764.917 4.623 4.355 4 111 3.889 3.685 3.498 3.326 Period 7 6.728 6.4725.230 6.002 5.786 5.582 5.206 4.868 4.564 4.288 4039 3.812 3.605 Period 8 7.652 7.3257.020 6.733 6.463 6.210 5.747 6.335 4.968 4.639 4344 4.078 3.837 Period 9 8.566 8. 1627.786 7.435 7.108 6.802 6 247 5.759 5.328 4.946 4,303 4.031 Period 10 9.471 8.983 | 8.530 8.111 7.722 7.360 6.710 6.145 5.650 5.216 4.833 4.494 4.192 Period 11 10.368 9.7879.253 8.760 8.3067.887 7.139 6.495 5.938 5.453 5029 4.656 4.327 Period 12 11.255 10.575 9.954 9.3858.863 8.384 7.536 6.814 6.194 5.660 5.197 4.793 4.439 Period 13 12.134 11 348 10.6359.986 9.394 8.853 7.90471036.424 6.842 5.342 4910 4,533 Period 14 13.004 12.106 11.296 10.563 9.899 9.295 8.244 7.367 6.6286.002 5.468 5.008 4.611 Period 15 13.865 12.849 11.938 11.11810.380 9.7128.5597.6066.811 6.142 5.575 5.092 4 675 Period 2018.046 16.351 14.877 13.690 12.462 11.470 9.818 8.514 7.469 6.623 5.929 5.353 4.870 Period 25 22.023 19.523 17.413 15 622 14.094 12.783 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 11.2589.4278.056 7.003 6.177 5.517 4.979 Period 40 32.835 27 355 23.115 19.793 17.159 15.046 11.925 9.7798.244 7.105 6.233 5,548 4.997 4.607 th al th 1 Jative al ve Present Value of $1 Periods 1% 296 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 209 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 0.9800.961 0.943 0.925 0.907 0.890 0.8570.826 0.797 0.769 0.743 0.7180.694 Period 3 0.971 0.942 0.915 0.8890.864 0.840 0.794 0.751 0.712 0.675 0.641 0.609 0.579 Period 4 0.961 0.924 0.888 0.855 0.823 0.792 0.735 0.683 0.636 0.592 0.552 0.516 0.482 Period 5 0.951 0.906 0.863 0.822 0.784 0.747 0.681 0.621 0.567 0.519 0.476 0.437 0.402 Period 6 0.942 0.888 0.837 0.790 0.746 0.705 0.630 0.564 0.507 0.4560.410 0.370 0.335 Period 7 0.933 0.871 0.813 0.7600.711 0.665 0.583 0.513 0452 0.400 0.354 0.314 0.279 Period 8 0.923 0.853 0.789 0.731 0.677 0.627 0.540 0.467 0.404 0.351 0.305 0.266 0.233 Period 9 0.914 0.837 0.766 0.703 0.6450.592 0.500 0.424 0.361 0.308 0.263 0.225 0.194 Period 10 0.905 0.820 0.744 0676 0.614 0.558 0.463 0.386 0.322 0.270 0.227 0.191 0.162 Period 110.896 0.804 0.722 0.650 0.585 0.527 0.429 0.350 0.287 0.237 0.195 0.162 0.135 Period 12 0.887 0.788 0.701 0.625 0.557 0.497 0.397 0.319 0.257 0.208 0.168 0.137 0.112 Period 130.879 0.773 0.681 0.601 0.530 0.4690.368 0.290 0.229 0.182 0.145 0.116 0.093 Period 14 0.870 0.758 0.661 0.577 0.505 0.442 0.340 0.263 0.205 0.160 0.125 0.099 0.078 Period 15 0.861 0.743 0.642 0.556 0.481 0.417 0.315 0.239 0.183 0.140 0.108 0.084 0.065 Period 200.820 0.673 0.554 0.456 0.377 0.312 0.215 0.149 0.104 0.073 0.051 0.037 0.026 Period 25 0.780 0.610 0.4780 375 0.295 0233 0.146 0.092 0.059 0.038 0.024 0.016 0.010 Period 30 0.742 0.552 0.412 0.308 0.231 0.174 0.099 0.057 0.033 0.020 0.012 0.007 0.004 Period 400.672 0.453 0.307 0.208 0.142 0.097 0.046 0.022 0.011 0.005 0.003 0.001 0.001 ca PN e.) bai Future Value of Annuity of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 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 1.000 Period 2 2010 2020 2030 2.040 2050 2.060 2.080 2.100 2120 2.140 2.160 2.180 2200 Period 3 3.030 3.060 3.091 3.122 3.153 3.184 3.246 3.310 3.374 3.440 3.506 3572 3.640 Period 4 4,060 4 122 4.184 4.246 4.310 4 375 4506 4.641 4.779 4.921 5066 5.215 5.368 Period 5 5.101 5.204 5309 5.416 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 6.802 6.975 7.336 7.716 8.115 8,536 8.977 9.442 9.930 Period 7 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 Period 8 8286 8.583 8.892 9.214 9549 9.897 10.637 11 436 12.300 13.233 14.240 15.327 16.499 Period 9 9.369 9.755 10.159 10.583 11.027 11.491 12 488 13.579 14.776 16.085 17.519 19.096 20.799 Period 10 10.462 10.950 11464 12.006 12.578 13.181 14.487 15.937 17.549 19.337 21.321 23.521 25 959 Period 11 11.567 12.16912808 13.486 14.207 14.972 16.645 18.531 20.655 23.045 25.733 28.755 32.150 Period 12 1268313 412 14192 15.026 15.917 16.870 18.977 21.384 24.133 27 271 30 850 34.931 39.581 Period 13 13.809 14.680 15.618 | 16.627 17.713 18.882 21.495 24.523 28.029 32.089 36.786 42.219 48.497 Period 14 1494715.97417 086 18 292 19.59921015 24 215 27.975 32 393 37.581 43.672 50.818 59.196 Period 15 16.097 17.29318.599 20.024 21.579 23.276 27 1523177237280 43 842 51.660 60.965 72.035 Period 20 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 Period 25 28 243 32.030 36 459 41.646 47.72754 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 058 113.283 164 494 241 333 356.787 530.312 790.948 Period 40 1,181.882 48.886 60 402 75.401 95026 120.800 154.762 259.067 442.593 767,091 1,342.025 2,360.757 4,163.2137.343.858 1% 1.010 1.020 1.030 1.041 1.051 4% 1.040 1.082 1.125 1.170 1.217 Periods Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8 Period 9 Period 10 Period 11 Period 12 Period 13 Period 14 Period 15 Period 20 Period 25 Period 30 Period 40 1.062 1.072 1.083 1.094 1.105 2% 3% 1.020 1.030 1.040 1.061 1.061 1.093 1.082 1.126 1.104 1.159 1.126 1.194 1.149 1.230 1.172 1.267 1.195 1.305 1.219 1 344 1.243 1.384 1.268 1.426 1.294 1.469 1.319 1.513 1,346 1.558 1.265 1.316 1.369 1.423 1.480 ho Future Value of $1 5% 6% 8% 10% 12% 14% 16% 18% 20% 1.050 1.060 1.080 1100 1.120 1.140 1,160 1.180 1.200 1.103 1.124 1.166 1210 1.254 1.300 1,346 1.392 1.440 1.158 1.191 1.260 1.331 1.405 1.482 1.561 1.643 1.728 1216 1.262 1.360 1.464 1.574 1.689 1.811 1.939 2.074 1.276 1.338 1.469 1.611 1.762 1.925 2100 2288 2488 1.340 1.419 1.587 1.772 1.974 2.195 2.436 2.700 2.986 1,407 1.504 1.714 1.949 2.211 2.502 2826 3.185 3.583 1.477 1.594 1.851 2. 144 2476 2.853 3.278 3.759 4.300 1.551 1.689 1.999 2.358 2773 3.252 3.803 4.435 5.160 1.629 1.791 2.159 2.594 3.707 4411 5.234 6.192 1.710 1.898 2.332 2.853 3.479 4.226 5.117 6.176 7430 1.796 2012 2518 3.138 3.896 4.818 5.936 7.288 8.916 1.886 2.133 2.720 3.452 4363 5.492 6.886 8.599 10.699 1.980 2261 2.937 3.797 4.887 6.261 7.988 10.147 12.839 2079 2397 3.172 4.177 5.474 7.138 9266 11.974 15.407 2.653 3.207 4.661 6.727 9.646 13.743 19.461 27393 38.338 3.386 4.292 6.848 10.83517.000 26.462 40.874 62.669 95 396 4322 5.743 10.063 17 449 29.960 50.950 85.850 143.371 237376 7.040 10.286 21.725 45.259 93.051 188.884 378.721750 3781,469.772 3.106 1.116 1.127 1.138 1.149 1.161 1.220 1.282 1.348 1489 1.539 1.601 1.665 1.732 1.801 2.191 2666 3,243 4.801 1.486 1.641 1.811 2208 1.806 2.094 2.427 3.262