Identify the Fixed and Variable costs $in$ this case list the cost name, the amounts, and the total $of$ fixed cost and total for variable costs. Note for costs, you will use cash flows and not expenses $-in$ other words, you will not need $to$ compute depreciation

You work for a venture capitalist and have been asked $to$ analyze a proposal from a group $of$

investors interested $in$ building a new ski area $in$ Colorado, the Stardust Canyon Ski Resort. The

demand for skiing $is$ growing. Existing ski resorts have raised prices and reported record profits

for the last two seasons. Stardust Canyon$s$ business strategy $isto$ offer the ultimate ski experience $-$ short lift lines, uncongested ski slopes and spectacular scenery. With $a2500-$foot vertical drop, $10$ trails, and a single triple three person ski lift, $it$ can provide a very ncongested ski resort. The resort will have a triple$-$person ski lift. The planned triple$-$person

ski lift delivers a chair every $20$ seconds, $180$ chairs per hour $3$ chairs per minute $X60$ minutes per hour, $or540$ skiers per hour $180$ chairs per hour $X3$ skiers per chair. This puts $an$ average $of$ only $54$ skiers per hour $on$ each $of$ the $10$ trails. Some trails will $be$ more popular than others, but this average number $of$ skiers per trail per hour $is$ still below industry average.

The cost $to$ build the ski runs, parking lots, and buildings and $to$ erect the chair lift $is$ $$52$ million.

$To$ raise this amount $of$ capital requires $an$ annual financing cost debt service$*$ and dividends

$of$ $$8\mathrm{.}3$ million. The annual fixed operating cost land lease, utilities, labor, taxes, insurance $of$ the ski resort $is$ projected $tobe$ $$4\mathrm{.}1$ million. For each $100$ skiers per day, additional employees must $be$ hired $to$ staff the ticket office, ski patrol, parking lots and $so$ forth. The daily cost $of$ the

additional labor $is$ $$200$ per $100$ skiers per day. The typical skier makes two ski runs per day uses the lift twice. Ski resorts operate their lifts $8$

hours per day, $120$ days per year. Stardust Mountain plans $to$ sell one$-$day lift tickets for $$60$ per skier per day: $No$ season passes will $be$ offered.