Citations should also be used to give the original author credit and to indicate where they obtained their information. Furthermore – primary research can also be used as support when available; this may include interviews with experts or surveys which provide additional insight into the subject at hand. Ultimately – by including these points of evidence throughout a paper – one is able to create a more convincing case that is better able to withstand scrutiny!ured rate of return – in this case 12%. If the NPV turns out to be positive then the project may be approved.
To calculate NPV, we need to take into account the cash flows (dividends) as well as outflows of money (original investment). How to calculate the NPV
Initial Investment = $15 x 800 = $-12000
Cash Inflow 1=14%=$2100
Cash inflow 2 = 5% = $ 2050
NPV=((($2100/$1.12) + ($2050/$1.122)) /(-$12000))*100 = 18.6%.
This suggests that with a required rate of return at 12%, Tata Motors’ project has a positive net present value of 18.6%, meaning it will generate returns greater than its cost of capital. The IRR is also 28%. Therefore, the project will have a higher internal rate than cost of capital.