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 ...

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Definition: The net present value (NPV) of an investment is the present (discounted) value of future cash inflows minus the present value of the investment and any associated future cash outflows.

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 ...

Rey Adams is an economist and writer. He has 15+ years of professional experience in investment management and consulting. David Kindness is a Certified Public Accountant (CPA) and an expert in the ...

NPV calculates profitability using all projected cash inflows and outflows, considering time value of money. A positive NPV suggests a profitable project; a negative NPV suggests a loss. NPV's ...