What input levers would you suggest the park focus

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Reference no: EM131194214

It is 2013 and you have been hired as the financial analyst for Wild Bill's Really Wild Adventure. The economy is picking up and Wild Bill's Really Wild Adventure is going to reconvene the investors to revisit the ideal of the island resort that was put on hold as a result of the "Great Recession."

Updated information includes:

• The park will open in 2015
• Upfront investment is now $37 million, to be made at the end of 2014
• Fixed Costs are $5.5M and are expected to rise 5% per year
• Demand is expected to start at 900 visitors, growing 75 a year until it levels out at 1,500
• Variable cost is $38,000 per visit
• The park expects to charge $46,000
• The discount rate is 17%

Do your work on the worksheet labeled 2013 Analysis and answer the following within the spreadsheet:

• What is the calculated NPV?
• Should the project go forward? Explain why or why not.
• Assuming a growth of 100 visitors per year with no cap, how many visitors does the park need to attract in the first year to have a positive NPV?
• What input levers would you suggest the park focus on to ensure a positive NPV?

Attachment:- Wildbill_Data.xlsx

Reference no: EM131194214

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