Green Ltd has decided to implement a new strategic that will require the use of a new machine which will need an initial investment of Rs 30 million. This will impact both production, sales and the cash flows . The resulting forecasted cash flows and sales over the next five years are as follows: year 1 2 3 4 5 Sales(units in millions) 6 8 12 15 16.5 Additional 4 6.5 7 4 5.5 costs(millions) As a result of the change, the selling price per unit will increase to Rs15 and the variable cost per unit amounts to Rs8. There is also an initial amount of working capital of RS 4 millions needed and this will increase by 10% p.a. the company as a result will no longer will able to rent out the storage space yielding Rs25,000 p.a(ignore inflation for rent). It is the company's policy to allow for capital allowances at the rate of 20% p.a using the reducing balance method. After the five years, the machine will be disposed of, thereby the need to calculate any balancing allowance/charge in the final year. In addition, a tax charge of 30% will be charged on profits and paid one year in arrears. The annual inflation rates for each of the following items are as follows: Selling price 3% p.a Variable cost & additional costs 4% p.a Working capital 4%p.a Nominal discount rate 10% Required: (a) Advise the board about the financial viability of the project, supporting your recommendation with a Net Present Value calculation (in nominal terms). (30marks)