Mount Snow operates a Rocky Mountain ski resort. The company is planning its lift ticket pricing for the coming ski season. Investors would like to earn a 15% return on the company's $100 million of assets. The company incurs primarily fixed costs to groom the runs and operate the lifts. Mount Snow projects fixed costs to be $33,750,000

for the ski season. The resort serves about 750,000 skiers and snowboarders each season. Variable costs are $10 per guest. The resort had such a favorable reputation among skiers and snowboarders that it had some control over the lift ticket prices. Assume that Mount Snow's reputation has diminished and other resorts in the vicinity are charging only $65 per lift ticket. Mount Snow has become a price-taker and won't be able to charge more than its competitors. At the market price, Mount Snow's managers believe they will still serve 750,000 skiers and snowboarders each season

Assume that Mount Snow has found ways to cut its fixed costs to $30 million. What is its new target variable cost per skier/snowboarder? Compare this to the current variable cost per skier/snowboarder. Comment on your results.

Complete the following table to calculate Mount Snow's new target variable cost per customer. (Round your final answer to the nearest cent.)

Less:
Less:
Target total variable costs
Divided by:
Target variable cost per skier / snowboarder