Oxford lies north west of London and is the location for one of the most prestigious universities in the world. However the city does not only hold a university but also a number of companies like BMW. One of the suppliers to BMW and other companies in the car industry is Low Friction Plc, LF. This company is specializing in development and production of ball bearings and particularly ball bearings for electrical vehicles. CEO for LF is Johannes Almens who graduated from Oxford University but somehow got into business and ended up at LF. Johannes is reporting to the chairman of the board, Annie Brundenborrow who comes from the family that holds a majority stake in the company. Since 2022 the company has a new CFO, Bodil Svensson. Bodil was recognised by Johannes when she delivered her master thesis at Linneaus University in Sweden with the title Portfolio analysis the leverage in optimisation. Life is not easy for Bodil who needs to keep pace with the demands from Johannes and even more so from Annie. For 2024 the terms set by the board is as follows. Base rate of return to be used for any investment and initiatives is 5%. Tax rate is 20% and any investment needs to deliver a return on investment, ROI, of 15% Given the nature of an investment or initiative can be added with a risk premium as follows: RP1 5%, RP2 7% and RP3 10%. Interest from borrowing for the bank is set at 5,5%. Interest for deposit in banks is set at 3,8% ROI is not applicable for financial investments. The market conditions for Low Friction Plc is rather demanding to say the least. Monday morning Bodil got a call from Johannes that she needed to come an meet with him and Annie at The Ritz Hotel in London ASAP (as soon as possible) or at least at 6PM when dinner is served at their restaurant. A room is already booked Johannes added. Bodil informed her staff that she would be off for a few days and went home to get her things packed and then took the train to London. She arrived at the hotel an hour ahead of dinner and was just ready to meet with Annie and Johannes when she got a SMS from Annie that they were waiting for her in the bar. Once at the bar the staff showed her into a private room and was greeted by Annie and John. The table in the room was filled with papers and a projector displayed ever changing market rates on a screen. Annie held a glass of ice water in her hand an looked worried and Johannes buried his head in a report. What's up Bodil said? Annie summed it up: Great opportunity but with a lot of risk! Annie continued: The development of electrical vehicles is moving fast but in different directions. However there is a niche that is attractive for LF Plc. Ball Bearings are one of the centrepieces of the electrical motors. However this has not been an issue until now. Our engineers have developed a low friction ball bearing that would improve the efficiency of the motors by 5% and that is a lot! Now we have screened the market an the investment and came to the following conclusion. The investment needed is around 9 000 000. The investment is way over what Annie and Johannes can decide for and the investment needs to be approved by the board. The market for electrical vehicles is unpredictable but we recon that there is a probability for good market conditions for 2024 is 60% and in that case we believe that the cash flow received will be 6 000 000 and if the market is bad 1 000 000. Given good market conditions the following years cash flow is expected to be 2 000 000 at 10%, 6 000 000 at 40% and 12 000 000 at 50% probability. If conditions 2024 will be bad the following year is expected to deliver a cash flow of 2000 000 at 20%, 7 000 000 at 25% and 11 000 000 at 55%. That is when Annie ended her "speech" but added: Either you call your staff and let them make the analysis and come with us to The Ritz Restaurant or you do the analysis yourself. Bodil thought about this for five seconds and called you! Make a proper analyse of this and propose what to do. Will this initiative be sent to the board or not? Write answer in Excel