XYZ CO. is considering a project with following cash flows:

Initial investment	OMR 110,000
Variable costs per unit	OMR 10
Selling price per unit	OMR 13
Number of unit produced and sold	25,000 units per year
Project life	2 years
Cost of capital	10%

1. What is the sensitivity of the project NPV to the change in sales volume?

a-15.47%

b-4.61%

c-2.61%

d-6.46%

2. What is the sensitivity of the project NPV to the change in selling price?

a-28.81%

b-3.57%

c-9.40%

d-4.90%

3. What is the sensitivity of the project NPV to the change in variable costs?

a-4.64%

b-6.51%

c-5.64%

d-0.95%

4. To which variable the project NPV appears to be most sensitive?

a-Variable costs

b-Selling price

c-Sales volume

d-Initial investment