The senior management of Kearney Brothors Limited $("\text{'}$KBL$")$ have just recently approved a project to manufacture a new innovative product called the "Zylex". You have been asked to evaluate the project using the Not Present Value method. The background to the project is as follows: $(1)$ The project is expected to last for four years. $(2)$ KBL has carried out initial market research at a cost of $500,000.(3)$ KBL is uncertain of the number of units of the "Zylex it will be able to manufacture and sell. Using the information obtained from the initial market research, KBL has determined the following probability estimates: Units $45,00050,00055,00060\mathrm{.}000$ Probability $\mathrm{.}3\mathrm{.}2\mathrm{.}4\mathrm{.}1$The number of units to be manufactured and sold will remain constant over the ife of the project. $(4)$ The selling price per unit of the "Zylex" in Year $1$ will be $/$E $10$ per unit and this wil increase by $10\%$ each year thereafter. $(5)$ Each unit of the "Zylex$*$ requires one item of raw material which costs $/2\mathrm{.}50$ per unit. Due to market efficiencies the cost is expected to remain constant over the four year period. $(6)$ The manufacturing process generates a by$-$product which will have to be disposed of at a cost of $/0\mathrm{.}15$ per unit manufactured. $(7)$ KBL will hire skilled workers to manufacture the 'Zylex". Each worker will be paid $/4\mathrm{.}00$ for each unit manufactured. $(8)$ Existing fixed overheads amounting to $/50,000$ per annum will be allocated to the new project. $(9)$ KBL will spend $/70,000$ per annum on advertising and marketing in year $1$ and year $2$ and $/$F$\mathrm{.}20,000$ per annum in year $3$ and year $4.(10)$ KBL will purchase a machine for $/450,000$ to manufacture the "Zylex" immediately. This machine will have a scrap value of $/50,000$ at the end of the project. This machine will be depreciated on a straight line basis over the life of the project. $(11)$ KBL will take out a loan for the purchase of the above machine and interest at a rate of $7\%$ will be paid annually on this loan. $(12)$ Working capital of $/105,000$ will be required at the commencement of the project. $(13)$ The cost of capital is $10\%.(14)$ Taxation can be ignored. $(15)$ Assume all cashflows occur at the end of each year unless told otherwise. Requirement Calculate the Net Present Value $($NPV$)$ and Payback of this project and advise KBL$\text{'}$s senior management whether or not this project is viable $(20$ Marks$)$