Yes this can be a cautionary tale
Your question is incomplete because you have not provided the underlined pronoun. Thus, the complete sentence is the following:
Nathan told Nadir that <u>his</u> nerves would impact the horse's ability to carry them through the competition.
Answer:
Case: nominative
Reference: ambiguous
Sentence rewritten: After seeing that Nadir was nervous, Nathan told him that nerves would impact the horse's ability to carry them through the competition.
Explanation:
The possessive adjective his functions as nominative case because the noun phrase his nerves functions as the subject of a verb. Besides, it creates ambiguity because it is not clear whose nerves it refers to - Nathan or Nadir's. As a result, it is necessary to rewrite the sentence to clarify whose nerves affect the horse's performance.
The correct option is this: THE SPEAKER FEELS NO TIME CAN BE LOST PONDERING ACTION WITH SUCH A THREAT.
From the excerpt given above, it can be seen that Japan had surprisingly attacked USA, while giving them false hope that they intend to be at peace with USA. With all the surprising moves of Japan, the speaker is saying in the excerpt above that, no time should be lost in tackling Japan in order to stop the onslaught on USA.