Net Present Value (NPV) Method

Net Present Value (NPV) Method is discounted cash-flow method that calculates the expected net monetary gain and loss from a project by discounting all expected future cash inflows and outflows to the present point in time, using the required rate of return.

Capital Budgeting Decisions

Learning Objectives: Evaluate the acceptability of an investment project using the net present value method. Evaluate the acceptability of an investment project using the internal rate of return method. Evaluate an investment project that has uncertain cash flows. Rank investment projects in order of