Ford has introduced a new series of hybrid cars. The financial statements for the first year are provided below.

Income Statement for the Year Ended December 31, 2023:

• Sales revenue: $3,200,000
• Cost of goods sold: $2,000,000
• Gross margin: $1,200,000
• Operating expenses: $500,000
• Depreciation expense: $200,000
• Operating income: $500,000
• Non-operating items: $30,000
• Net income: $470,000

Balance Sheet as of December 31, 2023:

• Assets:
  • Cash: $150,000
  • Accounts receivable: $600,000
  • Merchandise inventory: $400,000
  • Equipment (less accumulated depreciation): $1,200,000
  • Total assets: $2,350,000
• Liabilities:
  • Accounts payable: $400,000
  • Notes payable: $600,000
  • Total liabilities: $1,000,000
  • Stockholders' equity: $1,350,000

Required:

1. Calculate the ROI for Ford’s new hybrid cars.
2. Ford’s headquarters has $200,000 available for investment, targeting an ROI of 12%. Calculate the new ROI if the funds are invested at an ROI of 15%.
3. Assess the impact on ROI if the funds are invested at an ROI of 8%.
4. Discuss the potential strategic benefits and risks of investing additional funds in the new hybrid cars.