Jefferson Mountain is a small ski rosort locatod in central Pennsytvania. In recent years, the resort has, experienced two major problems: (1) unusually low annuolsnowfals and (2) long lift lines. To remedy these problems, manogement is considering two investment proposals. The fist involvos a $125000 investment in equipment used to make artificlal snow. The socorid involves the $180,000 purchase of a new high-speed chairist. The most thot the resort can afford to irvest at this time is $200,000. Thus, it cannot afford to fund both proposats. Choosing one proposal ower the other is somewhat problematic, If the resort funds the snow-making equipment, business will increase, and ift Hines will become even longer than they are cuirently, if it funds the chairlift, lines will be shortened, but there may not be enough notural snow to attract skiers to the mountain. Neither investment is expected to have any salvage value. Furthermore, the only difference between incremental cash flow and incremental income is stributable to depreciation. Due to inherent risks associated with the ski industry and the resort's high cost of capital, a minimum retum on investment of 20 percent is required. Use straight tine depreciation method. Required: a. Compute the payback period of each proposal. (Round your answers to 1 decimal place.) b. Compute the return on average investment of each proposal, (Round your answers to 2 decimal places.) c. Compute the net present value of each proposal using the tables in Exhibits 26-3 and 26-4. (Round "PV Factor" to 3 decimal places, intermediate and final answers to the nearest dollar amount.) d. What noninancial foctors should be considered? (You may select more than one answer. Single click the box with the questlon mark to produce a check mark for a correct answer and double click the box with the questlon mark to empty the box for a wrong answer. Any bowes left with a question mark will be automatically graded as incorrect.) Existing chalrifts. Recent weather patterns. Alternative investment opportunities. Corporate image Employee morale e. Which proposal, if either, do you recommend as a capital investment? Snow-Making Equlpment Choirift