Winter Run operates a Rocky Mountain ski resort. The company is planning its lift ticket pricing for the coming ski season. i (Click the icon to view the information.) Read the requirements. Requirement 1. If Winter Run cannot reduce its costs, what profit will it earn? State your answer in dollars and as a percent of assets. Will investors be happy with the profit level? Complete the following table to calculate Winter Run's projected income. Revenue at market price Less: Total costs More Info Operating income Requirements Investors would like to earn a 15% return on investment on the company's $135,000,000 of assets. Winter Run projects fixed costs to be $36,000,000 for the ski season. The resort serves about 750,000 skiers and snowboarders each season. Variable costs are about $9 per guest. Last year, due to its favorable reputation, Winter Run was a price-setter and was able to charge $5 more per lift ticket than its competitors without a reduction in the number of customers it received. 1. If Winter Run cannot reduce its costs, what profit will it earn? State your answer in dollars and as a percent of assets. Will investors be happy with the profit level? 2. Assume Winter Run has found ways to cut its fixed costs to $33,500,000. What is its new target variable cost per skier/snowboarder? Assume that Winter Run's reputation has diminished and other resorts in the vicinity are charging only $79 per lift ticket. Winter Run has become a price-taker and will not be able to charge more than its competitors. At the market price, Winter Run managers believe they will still serve 750,000 skiers and snowboarders each season. Print Done Print Done Enter any number in the edit fields and then click Check Answer. CE parts remaining Clear All Check