サインイン

The Net Present Value (NPV) method is a financial technique used to assess the profitability of an investment or project by comparing the present value of future cash inflows to the initial investment. The formula for NPV is:

Equation 1

Where:

  1. R_t represents the net cash inflows expected in the future.
  2. i is the discount rate, reflecting money's risk and time value.
  3. t is the time period when the cash flow occurs.
  4. C_0 is the initial investment or cost required for the project.

This formula sums the present value of all future cash inflows and subtracts the initial investment, yielding the NPV, which can be positive, zero, or negative. A positive NPV indicates profitability, while a negative NPV suggests the investment may not be financially viable.

When calculating NPV, it's essential to remember that the process of discounting cash flows is straightforward once the cash flows and discount rate are known. However, the real challenge lies in accurately estimating those cash flows and the appropriate discount rate. As these are only estimates, the actual NPV may vary, emphasizing the importance of making reliable projections.

章から 7:

article

Now Playing

7.10 : Net Present Value Method

Capital Budgeting

137 閲覧数

article

7.1 : Introduction to Capital Budgeting

Capital Budgeting

237 閲覧数

article

7.2 : Basics of Investment Decision-making

Capital Budgeting

128 閲覧数

article

7.3 : Importance of Capital Budgeting

Capital Budgeting

95 閲覧数

article

7.4 : Advantages and Limitations of Capital Budgeting

Capital Budgeting

277 閲覧数

article

7.5 : Capital Budgeting Techniques

Capital Budgeting

142 閲覧数

article

7.6 : Payback

Capital Budgeting

85 閲覧数

article

7.7 : Payback Period

Capital Budgeting

49 閲覧数

article

7.8 : Discounted Payback Period

Capital Budgeting

69 閲覧数

article

7.9 : Net Present Value

Capital Budgeting

251 閲覧数

article

7.11 : Decision-making Through Net Present Value

Capital Budgeting

54 閲覧数

article

7.12 : Internal Rate of Return

Capital Budgeting

144 閲覧数

article

7.13 : Calculating Internal Rate of Return

Capital Budgeting

39 閲覧数

article

7.14 : Decision-making Through Internal Rate of Return

Capital Budgeting

46 閲覧数

article

7.15 : Average Rate of Return

Capital Budgeting

47 閲覧数

See More

JoVE Logo

個人情報保護方針

利用規約

一般データ保護規則

研究

教育

JoVEについて

Copyright © 2023 MyJoVE Corporation. All rights reserved