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Powell Hospitality Ltd. is proposing the redevelopment of the spa at its Whispering Winds Resort. Currently the spa space is leased to a spa management company, but Powell Hospitality Ltd. wants to bring the operation in-house to have more control. The spa facility will also be expanded from its current 5,000 square feet to 10,000 square feet, with 8,000 square feet of indoor space and 2,000 square feet of outdoor treatment space. Powell Hospitality Ltd. believes it is time to expand its facility because the health and fitness industry has experienced rapid growth due to increasing health awareness. The goal of the spa facility will be to offer guests of the resort, visitors to the area, members, and people living and working nearby the opportunity to experience a world-class spa facility. The spa will provide an additional revenue stream for the resort and should increase occupancy during the slow periods by offering spa conference packages. On average, it is estimate 180 guests will visit the facility throughout the day. The spa will offer services including massage, herbal wraps, facials, mind/body programs, fitness activities, and alternative health treatments. Here are some financial projections for the spa: 1. Based on the projections, how much is this stream of uneven cash flows worth today if the discount rate is 10%? First, compute the present value of each year’s cash flow individually and add the results. Then, check your answer utilizing the cash flow function. 2. Given the present value calculated in question 1, what will this be worth in 4 years’ time?