a.Use the information provided in the case and calculate the weighted average cost of capital for Arizona Snowbowl.
b.e.Do you believe the weighted average cost of capital you calculated in part d accurately reflects Snowbowl’s WACC? If so, why? If not, explain why not and give your estimate of Snowbowl’s actual WACC. Justify your answer
c.Generate depreciation schedules for the EIS and for the remaining investment required for the project.
d.Calculate ‘base case’ cash flows resulting from the project for each of the next 10 years (disregarding the uncertainty associated with regulatory approval and any judicial proceedings). Use the following assumptions: The anticipated increase in skier days occurs immediately upon completion of the project, beginning in 2006.