Net Present Value - NPV

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Last modified by

KurtHeckman

on

Jul 24, 2020, 6:28:07 PM

Created by

KurtHeckman

on

Sep 21, 2016, 11:38:20 AM

N P V = \sum_{t=1}^{T} \frac{C_{t}}{{(1 + r)}^{t}} - C_{0}

$NPV = sum_"t=1"^T C_t/(1+r)^t - C_0$

(C_{t}) Cash flow per period

$(C_t)"Cash flow per period"$

(C_{0}) Iniitial investment cost

$(C_0)"Iniitial investment cost"$

(r) discount rate

$(r)"discount rate"$

(T) number of time periods

$(T)"number of time periods"$

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The Net Present Value (NPV) calculator computes the profitability of an investment that is calculated by subtracting the present values (PV) of cash outflows (including initial cost) from the present values of cash inflows over a period of time.

INSTRUCTIONS: Choose the preferred currency units and enter the following:

(C_t) - This is the comma separated values for the cash flow for each period.
(C_o) - This is the Initial cost of investment. Choose currency first and enter value.
(r) - Discount rate. This is the return that could be eared per unit of time on an investment with similar risk.
(T) - This is the number of periods.

Net Present Value(NPV): The calculator returns the Net Present Value (NPV) of investment in the currency units of the initial cost. Automatic unit conversions are available via the pull-down menu.

References

See Wikipedia article HERE.

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Net Present Value - NPV

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