Task III 30 points Yes, whatever Nils had been told came true. Ashridge Metal was a complete mess but very charming with a nice atmosphere with exception of sporadic instances mostly created by John and Annie. Nils had seen decisions that were all over the place but sometimes been surprises that some was absolutely correct but with no foundation what so ever. This morning John and Annie came in to Nils office for a curtesy visit. However Nils had learned that they always had something going. After a chat about nothing and golf in particular John cleared his throat. "You know that Elenore is very picky and sometimes rather intimidating if she discovers that we continue doing business as always. During breakfast me and Annie agreed that we need to make an investment as the company has surplus cash. You have made a fantastic job with inventories and account receivables but we can not let all that money stay idle at our account with Barclays. We have decided to invest in two companies; JG (Jones Garments) Plc and F&C ( Fish and Chips) Plc. According to the market the outlook is as follows: The likelihood of market conditions is 15% for Good, 45% for Normal and 40% for Bad... that is a known fact! According to accepted analyses the expected return for JG Plc the expected return for Bad is 0%, Normal 15% and for Good 30%. When it comes to F&C Pls the expected return is 6% for Good, 9% for Normal and 15% for Bad. Annie and I made a calculation on the back of a napkin and concluded that we invest in a combination of 40% JG and 60% F&C. Let us invest 10 000 000 in this. It must be a safe bet!" Nils almost fell off his chair but managed to calm down. "Now what I need to do is to verify this and call to Elinore as we are not allowed to do such investment without her approval" To Nils surprise the numbers John and Annie had provided him with turned out to be correct. He called to Annie and asked where they had found the returns and probabilities and got the answer back that they kind of had figured this out by themselves. Nils also found that there are few better companies to invest in at the moment. Nils now need to do a proper analyse of this and make a conclusion before he could make a call to Elinore. Help Nils with this and make a conclusion of whether John and Annie's proposal is good or not. Maybe you need to propose a change. Task III 30 points Yes, whatever Nils had been told came true. Ashridge Metal was a complete mess but very charming with a nice atmosphere with exception of sporadic instances mostly created by John and Annie. Nils had seen decisions that were all over the place but sometimes been surprises that some was absolutely correct but with no foundation what so ever. This morning John and Annie came in to Nils office for a curtesy visit. However Nils had learned that they always had something going. After a chat about nothing and golf in particular John cleared his throat. "You know that Elenore is very picky and sometimes rather intimidating if she discovers that we continue doing business as always. During breakfast me and Annie agreed that we need to make an investment as the company has surplus cash. You have made a fantastic job with inventories and account receivables but we can not let all that money stay idle at our account with Barclays. We have decided to invest in two companies; JG (Jones Garments) Plc and F&C ( Fish and Chips) Plc. According to the market the outlook is as follows: The likelihood of market conditions is 15% for Good, 45% for Normal and 40% for Bad... that is a known fact! According to accepted analyses the expected return for JG Plc the expected return for Bad is 0%, Normal 15% and for Good 30%. When it comes to F&C Pls the expected return is 6% for Good, 9% for Normal and 15% for Bad. Annie and I made a calculation on the back of a napkin and concluded that we invest in a combination of 40% JG and 60% F&C. Let us invest 10 000 000 in this. It must be a safe bet!" Nils almost fell off his chair but managed to calm down. "Now what I need to do is to verify this and call to Elinore as we are not allowed to do such investment without her approval" To Nils surprise the numbers John and Annie had provided him with turned out to be correct. He called to Annie and asked where they had found the returns and probabilities and got the answer back that they kind of had figured this out by themselves. Nils also found that there are few better companies to invest in at the moment. Nils now need to do a proper analyse of this and make a conclusion before he could make a call to Elinore. Help Nils with this and make a conclusion of whether John and Annie's proposal is good or not. Maybe you need to propose a change
