Related Topics:

Spreadsheet Mathematical Functions

Function Wizard Functions

NPV

Description: Calculates the net present value of an investment with the discount rate and several future payments and income.

Syntax: NPV(Rate, Value1, Value2, ...)

Remarks:

Example:

Suppose you're considering an investment in which you pay $10,000 one year from today and receive an annual income of $3,000, $4,200 and $6,800 in the three years that follow. Assuming an annual discount rate of 10 percent, the net present value of this investment is:

In the preceding example, you include the initial $10,000 cost as one of the values, because the payment occurs at the end of the first period.

 

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