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    Khawk's Avatar
    Khawk Posts: 1, Reputation: 1
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    #1

    Aug 20, 2009, 11:02 AM
    Deer Valley
    Assume that the after-tax required rate of return for Deer Valley is 8%, the income tax rate is 40%, and the MACRS recovery period is 10 years. Compute the after-tax NPV of the new lift and advise the managers of Deer Valley about whether adding the lift will be a profitable investment. Show calculations to support your answer.
    morgaine300's Avatar
    morgaine300 Posts: 6,561, Reputation: 276
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    #2

    Aug 20, 2009, 05:31 PM

    Please see our guidelines for posting homework questions:
    Ask Me Help Desk - Announcements in Forum : Homework Help

    I'm not even quite sure what it is you're wanting here. You've only provided a portion of the information needed to solve this, and you didn't ask any questions about a specific part of the problem you don't understand. So you not only need to provide your attempts at the problem so someone can guide you from there, but you also need to provide the whole problem instead of bits and specks of it, unless you just have a general question.
    Jenie's Avatar
    Jenie Posts: 1, Reputation: 1
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    #3

    Dec 13, 2013, 03:26 PM
    Deer Valley Lodge, a ski resort in the Wasatch Mountains of Utah, has plans to eventually add five new chairlifts. Suppose that one lift costs $2 million, and preparing the slope and installing the lift costs another $1.3 million. The lift will allow 300 additional skiers on the slopes, but there are only 40 days a year when the extra capacity will be needed. (Assume that Deer Valley Lodge will sell all 300 lift tickets on those 40 days.) Running the new lift will cost $500 a day for the entire 200 days the lodge is open. Assume that the lift tickets at Deer Valley cost $55 a day

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