Net present value helps management or potential investors weigh the wisdom of an investment by enabling the expected benefits to be quantified. It is used in investment control to gauge whether a ...

Small business owners frequently make decisions about how to invest money to increase profitability. Part of being a good business manager is the ability to analyze the income potential of long-term ...

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 ...

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 ...

Brian Beers is a digital editor, writer, Emmy-nominated producer, and content expert with 15+ years of experience writing about corporate finance & accounting, fundamental analysis, and investing.

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.

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 ...

MIRR is just like a net present value calculation. You need to choose discount rates, which is effectively the same as choosing financing and reinvestment rates. IRR is a discount rate used to make ...