Score: 0 of 4 pts 7 of 8 (5 complete) HW Score: 55%, 16.5 of 30 pts E12-33A (book/static) Question Help Consider how Wolf Valley, a popular ski resort, could use capital budgeting to decide whether the $8 million Brook Park Lodge expansion would be a good investment. (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 attractivo? 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 net present value.) Net present value of expansion $ 6717734.80 Question Help chta Table Reference RI Periods 1 2 3 4 R 1642 1566 5 N 6 7 Assume that Wolf Valley's managers developed the following estimates concerning a planned expansion to its Brook Park Lodge (all numbers assumed) Number of additional skiers per day 125 Average number of days per year that weather conditions allow skiing at Wolf Valley 160 Useful life of expansion (in years) 8 Average cash spent by each skier per day $ 240 Average variable cost of serving each skier per day.. 142 Cost of expansion $ 8,000,000 Discount rate. 12% Assume that Wolf Valley uses the straight line depreciation method and expects the lodge expansion to have a residual value of $1,000,000 at the end of seght your life. It has already calculated the average annual net cash inflow per year to be $1,060,000 9 10 Present Value of Annuity of $1 1% 3% 4% 5% 6% 105 12% 16% 16% 18% 20% 0.00 0.90 0.971 0.962 09620043 0.909 0.83 0.877 0.862 0.847 0.833 1.570 1.542 1913 1886 1859 1.830 1.780 1.736 1.590 1.805 2.941 244 2.829 2775 2723 2673 2577 2.47 2402 2322 2.246 2174 2106 3.902 3.800 3717 3630 3545 3465 3.312 3.170 3.007 2014 2700 2800 2509 4853 4713 4580 4452 4329 42123.990 3.791 3605 3.4333274 3.127 2991 5.795 5.601 5417 5242 5076 4917 4.111 3.8893.645 3.498 3.326 6728 6472 6230 6.002 5786 5582 5.2016 4868 4.564 4.2884.000 3812 3 605 7.652 7.325 7020 6733 6463 6210 57475335 40 4530 4344 40783337 8,566 8.162 7.788 7.435 7108 6.802 6247 5759 $329 49 4.607 4303 4001 9.471 8.933 8.530 8.111 7.722 7.360 6.710 6.145 5.6505.216 4.833 4494 4.192 10.368 9.787 9.253 8.760 8.305 7887 7.139 6.495 5938 5453 5.029 4.8554327 11 255 10.575 0.04 9.385 8.8638394 7530 6.814 6.194 5660 5.197 4.793 4.499 12 134 11.348 10.535 9.986 9.394 8853 7904 7.10364245842 5 342 4910 4.510 13.004 12 106 11.296 10.563 9899 92958244 6.699 6.002 5.488 4511 13.65 12.349 11938 11.118 103809712 8559 7.606 6.811 6.12 55755092 4675 18.046 1635 14.877 13500 12.46211.4709818 8.514 7.4806523 5.829 5.363 4870 22.023 1952317413 45.622 14091278310.675 2017 7.543 6873 6.097 5.457 4.0 258082239619.500 17292 15372 13765 112589427 8.057.000 6.1776.517 4879 32835 27 356 23 115 19793 17.159150411.925 9.7798244 7.1056230 5.548 4.997 $ 11 12 13 14 15 20 25 30 40 Print Done Enter and Print Done 3 parts remaining Clear All Check Answer Reference Valley, a popularskie o view the expansion view the present al o view the future valud Periods 123 16% 1 2 3 at is the project's NPU 2% 1000 2020 3060 4122 5204 2180 4% 1000 2040 3.122 4246 5.416 3153 4 15 1.000 2010 3030 4060 5.101 6.152 7214 8286 9.369 sent value of the ex 5 expansion $ 67 6308 6 7 B 9 10 11 12 13 14 15 34 1000 2030 3001 4184 5.309 6.468 7.662 B892 10.150 11464 12.800 16.182 15618 170 18.599 26870 95456 47575 75.401 7434 8.583 9755 10.950 12.16 13.412 14.680 15 974 17 293 24 297 2030 400 60402 Future Value of Annuity of $1 5% 65 8% 10% 1000 1.000 1.000 1.000 2.050 2.060 2.080 2.100 3.184 3246 3310 4.310 4.375 4506 4.641 5.526 5.637 5.867 6.105 6.802 6.975 7.338 7.716 8.142 8.314 8.923 94 9549 9.897 10.637 11436 11.027 11.491 12438 13.579 12578 13.181 14.487 15.937 14207 14.972 16.645 18.531 15.917 16.870 18.977 2134 17 713 18.882 2148 20.523 19.599 21.015 24 215 27.975 21579 23.276 27.152 31.772 33066 36.786 45.72 57 215 47127 54M 73.100 8.347 66.00 790 113200 1544M 120.800 15472 250 057 412.500 7.898 9214 10583 12000 13.486 15.020 16.627 18 292 20024 29 778 41 646 11.567 12.683 13.800 14947 16.097 22.019 18% 20% 1.000 1000 1.000 1.000 1.000 2.120 2140 2160 2200 3394 3506 3.572 3.640 4.779 4921 5060 5215 5368 6.350 8.610 6.877 7.154 7.442 8.115 8536 8.977 9442 9.930 10.08 10.730 11414 12.916 12.300 13.239 14240 15327 16499 14.775 18. 17510 19.086 20.799 17.540 19.337 21.321 23.521 25959 20.656 23.045 25730 28.756 32.150 24.10 27271 30.850 34931 39 581 28.020 32.000 36.7 42210 48.497 32.390 37581 43.672 50 818 59.106 3728 43842 51.680 60.905 72035 72052 91025 115380 145020 1866 133 334 161871 240 214 342803 471981 241333 36787 530312 790.94 1,18182 76709164120952M0757 4,163 21373438 20 20 30 40 78 48 BM 95.26 the edit fields and Print Dono Clear All Check An Duld use cap Reference - mes.) ity factor tab) y factor table Periods 45 16% 20% 1 investment 2 3 4 5 (Round your 0.962 0.925 0.889 0.855 0.822 0.790 0.760 0.731 0.703 0.676 80 14% 0.877 0.769 0.675 0.592 0.519 0.456 0.400 6 3% 0.971 0.943 0.915 0.888 0.863 0.837 0.813 0.789 0.766 0.744 0.722 0.701 0.681 0.661 0.642 7 1% 2% 0.990 0.980 0.980 0.961 0.971 0.942 0.961 0.924 0.951 0.906 0.942 0.888 0.933 0.871 0.923 0.853 0.914 0.837 0.905 0.820 0.896 0.804 0.887 0.788 0.879 0.773 0.870 0.758 0.861 0.743 0.820 0.673 0.780 0.610 0.742 0.552 0.672 0.453 12% 0.893 0.797 0.712 0.636 0.567 0.507 0.452 0.404 0.361 0.322 0.287 0.257 0.229 0.205 0.183 0.862 0.743 0.641 0.552 0.476 0.410 0.354 0.305 0.263 0.227 B 9 10 0351 Present Value of $1 5% 6% B% 10% 0.952 0.943 0.926 0.909 0.907 0.890 0.857 0.826 0.864 0.840 0.794 0.751 0.823 0.792 0.735 0.683 0.784 0.747 0.681 0.621 0.746 0.705 0.630 0.564 0.711 0.665 0.583 0.513 0.677 0.627 0.540 0.467 0.645 0.592 0.500 0.424 0.614 0.558 0.463 0.386 0.585 0527 0429 0.350 0557 0.497 0.397 0.319 0.530 0.469 0.368 0.290 0.505 0.442 0.340 0.263 0481 0.417 0.315 0239 0.377 0.3120.215 0.149 0295 0.233 0.146 0.092 0231 0.174 0.099 0.057 0.142 0.097 0.046 0.022 18% 0.847 0.718 0.609 0.516 0.437 0.370 0.314 0.266 0.225 0.191 0.162 0.137 0.116 0.099 0.084 0.037 0.016 0.007 0.001 0.833 0.694 0.579 0.482 0.402 0.336 0.279 0233 0.194 0.162 0.135 0.112 0.093 0.078 0.065 0.026 0.010 0.004 0.001 0.308 0270 0.237 0.208 0.182 0.160 0.140 0.073 0.038 0.020 0.005 11 12 13 14 15 0.650 0.625 0.601 0.577 0.555 0.456 0.375 0.308 0.208 0.195 0.168 0.145 0.125 0.108 20 25 30 40 0.554 0.478 0.412 0.307 0.104 0.059 0.033 0.011 0.051 0.024 0.012 0.003 ck Check All Print Done Reference 5 Periods 10% 14% 1 1.140 2 15 1.010 1.020 1.030 1.041 1.051 1.062 1.072 1.083 1,094 1.105 2% 1020 1.040 1.061 1,082 1.104 3% 1.030 1.061 1.093 1.126 1.159 1.040 1.062 1.125 1.170 1217 5% 1.050 1.103 1.158 1216 1 276 4 5 1.300 1.482 1,689 1.925 1.120 1.254 1.405 1.574 1.762 1.974 2211 2.478 2773 3.106 6 7 16% 1.160 1.346 1.561 1.811 2.100 2430 2826 3.278 3.803 4.411 8 1.194 1230 1.267 1.305 1.344 1.340 1.407 1477 1.551 1629 Future Value of $1 8% 1.060 1.000 1.124 1.166 1.191 1.260 1 262 1.360 1338 1.469 1.419 1,587 1.504 1.714 1.594 1.851 1.689 1.999 1.791 2.150 1.898 2332 2012 2518 2133 2720 2261 2937 3.172 3207 4661 4292 6.848 5.743 10.063 10.286 21.725 1.126 1.149 1.172 1.195 1219 1.243 1.268 1294 1.319 1 346 9 10 11 12 13 14 15 20 25 30 40 1.100 1.210 1.331 1.464 1.611 1.772 1949 2.144 2358 2504 2.853 3.138 3.452 3.797 4177 6.727 10.835 17.449 45.259 1265 1316 1369 1423 1480 1.539 1.601 1.665 1.732 1801 2191 2866 3243 4.801 18% 1.180 1.392 1.643 1.939 2 288 2700 3.185 3.759 4,435 5.234 6.176 7.288 8.500 10.147 11.974 1.116 1.127 1.138 1.149 1.161 20% 1.200 1440 1.728 2074 2488 2.986 3.583 4.300 5.160 6.192 7.430 8.916 10.699 12.839 15.407 38.338 95 396 237376 1.469.772 1.384 1426 1469 1.513 1.558 1.800 2004 2427 3.262 2.195 2.502 2853 3252 3.707 4.226 4.818 5.492 6.261 7.138 13.743 26.462 50.950 188,884 1.710 1.796 1 886 1980 2079 3.479 3.896 4.363 4887 5.474 2397 5.117 5.936 6.886 7.9BB 9.266 19.461 40.874 85.850 378.721 2653 1.220 1.282 1.348 1489 1 486 1.641 1.811 2208 3386 4322 7040 9.648 17.000 29.960 93.051 27.393 82669 143 371 750.378 Print Done Clear All apital budgeting to decide whether the $8 million Brook Park Lodge expansion would be a good investment. able.) ble.) (Click the icon to view the present value factor table.) (Click the icon to view the future value factor table.) nt attractive? WI 0 Requirements ur answer to the 1. What is the project's NPV? Is the investment attractive? Why or why not? 2. Assume the expansion has no residual value. What is the project's NPV? Is the investment still attractive? Why or why not? Print Done