The directors of company Damson Ltd is planning to invest in a new project that will lasts for four years. Following a preliminary analysis on the market, the accountant of the firm has made the following forecast: The company nominal cost of capital is $12\%.$ Required: $($a$)$ Calculate the NPV $($ignored taxation$).[5$ Marks$]($b$)$ Calculate the sensitivity of the project in relation to: $[10$ Marks$]($i$)$ Sales Volume $($ii$)$ Variable costs $($c$)$ Discuss your findings of section $($a$)$ and $($b$)$ above and advise whether the investment proposal is financially acceptable. $[3$ Marks $($d$)$ Discuss why it is important to take into consideration risk and uncertainty while appraising a project. $[5$ Marks$]$ Sales Volume $($units$)$ per year $25,000$ Rs Selling price per unit $($current price levels$)165$ Variable costs per unit $($current price levels$)95$ Incremental fixed costs $($current price levels$)900,000$ per annum Cost of machine $1,000,000$ Scrap value of machine at end of the project $($constant price terms$)350,000$ Inflation rate $4\mathrm{.}5\%$The company nominal cost of capital is $12\%.$ Required: $($a$)$ Calculate the NPV $($ignored taxation$).[5$ Marks$]($b$)$ Calculate the sensitivity of the project in relation to: $[10$ Marks$]($i$)$ Sales Volume $($ii$)$ Variable costs $($c$)$ Discuss your findings of section $($a$)$ and $($b$)$ above and advise whether the investment proposal is financially acceptable. $[3$ Marks $($d$)$ Discuss why it is important to take into consideration risk and uncertainty while appraising a project.