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help with part c theres no time Coolplay Corp. is thinking about opening a soccer camp in southern California. To start the camp, Coolplay would
help with part c
theres no time
Coolplay Corp. is thinking about opening a soccer camp in southern California. To start the camp, Coolplay would need to purchase land and build four soccer fields and a sleeping and dining facility to house 150 soccer players. Each year, the camp would be run for 8 sessions of 1 week each. The company would hire college soccer players as coaches. The camp attendees would be male and female soccer players ages 12-18. Property values in southern California have enjoyed a steady increase in value. It is expected that after using the facility for 20 years, Coolplay can sell the property for more than it was originally purchased for. The following amounts have been estimated. Cost of land Cost to build soccer fields, dorm and dining facility Annual cash inflows assuming 150 players and 8 weeks Annual cash outflows Estimated useful life Salvage value Discount rate $321,000 $642,000 $984,400 $898,800 20 years $1,605,000 Click here to view the factortable Your Answer Correct Answer To gauge the sensitivity of the project to these estimates, assume that if only 125 players attend each week, annual cash inflows will be $861,350 and annual cash outflows will be $802,500. What is the net present value using these alternative estimates? (if the net present value is negative, use either a negative sin preceding the number 3.-45 or parentheses eg. (45). Round answer to decimal places, s. 125. For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Net present value $ 40,849 Should the project be accepted? The project should be rejected Your answer is partially correct. Assuming the original facts, what is the net present value if the project is actually riskier than first assured and a 10% discount rate is more appropriate? (If the net present value is negative, use either a negative sign preceding the number e.g.-45 or parentheses eg. (45). Round answer to decimal places, eg. 125. For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Net present value $ Should the project be accepted? The project should be accepted Step by Step Solution
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