Indiana Inc. is appraising an investment project which has an expected life of four years, and which will not be repeated. The initial investment to start the project is OMR 4.9 to 5.2 million (pick any number between the range randomly). A scrap value of OMR 450,000 to 500,000 (pick any number between the range randomly) is expected to be received at the end of four years. There is some uncertainty about what price can be charged for the units produced by the investment project, as this is expected to depend on the future state of the economy. The following forecast of selling prices and their probabilities has been prepared: State of Economy Weak Medium Strong Probability* 30%-40% 40%-50% Unit Selling Price 20-30 30-40 40-50 *Pick any number between the ranges for your analysis. Probability for Strong state of economy is 100%- sum of probabilities of Weak and Medium states that you choose randomly. Incremental overheads of OMR 300,000 will be paid during the first year while overhead inflation of 10% per year is expected. Indiana Inc. has traditionally used a nominal aftertax discount rate of 11%-17% (pick any number between the range randomly) per year for investment appraisal. a. Evaluate the possible source of risk and uncertainty in the context of the above investment. (2 marks) b. Calculate the payback period, Discounted payback period, net present value, and internal rate of return of the investment project and comment on its financial acceptability. (8 marks)