Net present value
Net present value: use cash flows from time 0 onward, discount rate per period. Review the formula, worked example and calculation steps.
Inputs
Use the units shown—
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Formula & explanation
NPV = Σ CFₜ/(1+r)ᵗ
Variables & units
- Cash flows from time 0 onward
- comma separated
- Discount rate per period
- % · minimum 0, maximum 1000
Worked example
−1,000 today and 1,100 one period later at 10% discount gives NPV 0.
Assumptions
Regularly spaced cash flows. The supplied rate is per period, not necessarily per year.
Formula version 1.0.0. JavaScript floating-point arithmetic applies. Results display up to 6 decimal places; stored values retain available precision. Use the units shown.
Practice with an example
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