This shows you the differences between two versions of the page.
| Both sides previous revision Previous revision Next revision | Previous revision | ||
|
en:net-present-value [2018/01/18 13:21] federico |
— (current) | ||
|---|---|---|---|
| Line 1: | Line 1: | ||
| - | ====== Net Present Value (NPV) ====== | ||
| - | |||
| - | In [[capital budgeting]], the Net Present Value is the sum of the discounted future cash flows of an investment. | ||
| - | |||
| - | NPV = - I(0) + I(1)/(1+i) + I(2)/(1+i)² + ... + I(n)/(1+i)^n | ||
| - | |||
| - | Where: | ||
| - | I(0) : Initial Investment | ||
| - | I(1) : Cash flow of the first period. | ||
| - | I(2) : Cash flow of the second period. | ||
| - | I(n) : Cash flow of the nth period. | ||
| - | i : discount rate | ||
| - | |||
| - | |||
| - | See also:\\ | ||
| - | [[How to Calculate the NPV with Excel]]\\ | ||
| - | [[en:internal-rate-of-return-irr|Internal Rate of Return]] | ||