Net present value (NPV) is the difference between the present value of cash inflows and the present value of cash outflows over a period of time.

Knowing how to calculate net present value can be useful when choosing investments. In a nutshell, an investment's NPV can help you to analyze its potential for profit.

Advantages & Disadvantages of Net Present Value in Project Selection. Net present value, or NPV, is one of the calculations business managers use to evaluate capital projects. A capital project is ...

Internal rate of return (IRR) and net present value (NPV) aren’t always equally effective. Compare NPV vs. IRR to learn which to use for capital budgeting.