Net present value (NPV) represents the difference between the present value of cash inflows and outflows over a set time period. Knowing how to calculate net present value can be useful when choosing ...

Net present value and the profitability index are helpful tools that allow investors and companies make decisions about where to allocate their money for the best return. Net present value tells us ...

The concept of present value is based on the concept of time value. Since money has time value, a rupee today is more valuable than a rupee after one year. In any investment or in any project, the net ...

The discount factor of a company is the rate of return that a capital expenditure project must meet to be accepted. It is used to calculate the net present value of future cash flows from a project ...

Now I (sort of) understand why so many homeowners are in loan modification hell. This Dante's Housing Crisis Inferno has been fanned by the introduction of a simple calculation: the NPV. What's the ...

When a company is making capital budgeting decisions -- whether it's something as small as buying a new copier vs. servicing an old one or as big as entering a new market -- it must weigh the expected ...

In corporate finance and valuation, experts and self-taught learners rely upon various guiding principles. One of those core principles is the time value of money. Whether you’re a professional in the ...

Barclay Palmer is a creative executive with 10+ years of creating or managing premium programming and brands/businesses across various platforms. Thomas J. Brock is a CFA and CPA with more than 20 ...

Present value is a useful mathematical formula designed to figure out if money received now is worth more than money received later. What Is Present Value? Terms Associated With the Present Value of ...

Julia Kagan is a financial/consumer journalist and former senior editor, personal finance, of Investopedia. Thomas J. Brock is a CFA and CPA with more than 20 years of experience in various areas ...