NPV Example

This video shows an example of how calculate the NPV (net present value) of a project.
The NPV of a project is the sum of the project's discounted cash flows. The NPV is used as part of a decision rule by many companies: if the NPV of a project is greater than zero, the project is accepted, and if the NPV is less than zero the project is rejected. The cash flows of the project are discounted to the present value to account for the time value of money.-
Edspira is the creation of Michael McLaughlin, an award-winning professor who went from teenage homelessness to a PhD. Edspira’s mission is to make a high-quality business education freely available to the world.
-
SUBSCRIBE FOR A FREE 53-PAGE GUIDE TO THE FINANCIAL STATEMENTS, PLUS:
• A 23-PAGE GUIDE TO MANAGERIAL ACCOUNTING
• A 44-PAGE GUIDE TO U.S. TAXATION
• A 75-PAGE GUIDE TO FINANCIAL STATEMENT ANALYSIS
• MANY MORE FREE PDF GUIDES AND SPREADSHEETS
* eepurl.com/dIaa5z
-
SUPPORT EDSPIRA ON PATREON
* / prof_mclaughlin
-
GET CERTIFIED IN FINANCIAL STATEMENT ANALYSIS, IFRS 16, AND ASSET-LIABILITY MANAGEMENT
* edspira.thinkific.com
-
LISTEN TO THE SCHEME PODCAST
* Apple Podcasts: podcasts.apple.com/us/podcast...
* Spotify: open.spotify.com/show/4WaNTqV...
* Website: www.edspira.com/podcast-2/
-
GET TAX TIPS ON TIKTOK
* / prof_mclaughlin
-
ACCESS INDEX OF VIDEOS
* www.edspira.com/index
-
CONNECT WITH EDSPIRA
* Facebook: / edspira
* Instagram: / edspiradotcom
* LinkedIn: / edspira
-
CONNECT WITH MICHAEL
* Twitter: / prof_mclaughlin
* LinkedIn: / prof-michael-mclaughlin
-
ABOUT EDSPIRA AND ITS CREATOR
* www.edspira.com/about/
* michaelmclaughlin.com

[@thomasnguyen2438]

THANK YOU SO MUCH!!! This video saved me omg ILY!!

[@monicagarcia-hy6fo]

Thank you! this made it so easy for me to do my practice problems!

[@lohmonju3720]

Thank you so much 🙏

[@Divinepony]

What if they give you a cash outflow of a past year i.e. before the present. Would you have to use compounding to increase the value of the past cash outflow?

[@joukenienhuis6888]

Do I understand this example that the cash outflow is needed to get the projected inflows ? And can I also use it to calculate what I need to put on a savings account to get a regular income each year ?

[@khaioraalaghbari4419]

hi thank you for making it easy in this way. just one comment the rule used is wrong. it supposed to be FCF/ (1+ R)^n

[@sanjeevkumar-zx5yg]

irr ?