(a) Although project costs are generally estimated on the initial assumption that there will be no modifications in design that would necessitate changes in the physical work or relative changes in domestic or international prices, sound project planning requires that provisions called contingency allowances be made in advance for possible adverse changes in physical conditions or prices that would add to the baseline costs. Discus the two categories of contingency allowances provided for in project planning. [8 marks] (b) The adjustments necessary to convert financial prices to economic values are divided into three steps. Discuss the three steps using suitable examples. [12 marks]