How to Use Net Present Value (NPV) Let's say you're contemplating setting up a factory that's going to need initial funds of $250,000 during the first year.

Knowing how to calculate the net present value of an investment is a useful skill to have if you want to make the best decisions for your portfolio. Keep in mind, however, that NPV shouldn’t be ...

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 ...

We calculated that the net present value of all of the lemonade stand's cash flows was $34.20. However, to calculate the profitability index, we need the present value of the future cash flows only.

In Excel, create a cell for the discounted rate and columns for the year, cash flows, the present value of the cash flows, and the cumulative cash flow balance.