Consider how Cherry Valley, a popular ski resort, could use capital budgeting to decide whether the $$9$ million Waterfall 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 attractive? 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

Requirement $1.$ What Calculate the net pres

Net present value of $e$

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Assume that Cherry Valley's managers developed the following estimates concerning a planned expansion to its Waterfall Park Lodge $($all numbers assumed$)$:

Number of additional skiers per day

Awerage number of days per year that weather ditions allow skiing at Cherry Valley

Useful life of expansion $($in years$)$

Average cash spent by each skier per day $......$ $$.246$

Average variable cost of serving each skier per day.$

Cost of expansion $...................9,000,000$

Discount rate $..........................14\%$

Assume that Cherry Valley uses the straight$-$line depreciation method and expects the lodge expansion to have a residual value of $$750,000$

or a minus sign for a negative net present $v$