NPV


Definition of NPV:

This formula calculates the net present value of an investment based on a series of periodic cash flows and a discount rate.

Sample Usage 

NPV(0.08,200,250,300) 

NPV(A2,A3,A4,A5)

Syntax

NPV(discount, cashflow1, [cashflow2, ...])

  • discount - The discount rate of the investment over one period.
  • cashflow1 - The first future cash flow.
  • cashflow2, ... - [ OPTIONAL ] - Additional future cash flows.

Notes

  • NPV is similar to PV except that NPV allows variable-value cash flows.
  • Each cashflow argument should be positive if it represents income from the perspective of the owner of the investment (e.g. coupons) or negative if it represents payments (e.g. loan repayment).
  • Each cashflow argument may be either a value, a reference to a value, or a range containing values. Cashflows are considered in the order they are referenced.
  • IRR under the same conditions calculates the internal rate of return for which the net present value is zero.
  • If the cash flows of an investment are irregularly spaced, use XNPV instead.

 

See Also

XNPV: Calculates the net present value of an investment based on a specified series of potentially irregularly spaced cash flows and a discount rate.

XIRR: Calculates the internal rate of return of an investment based on a specified series of potentially irregularly spaced cash flows.

PV: Calculates the present value of an annuity investment based on constant-amount periodic payments and a constant interest rate.

MIRR: Calculates the modified internal rate of return on an investment based on a series of periodic cash flows and the difference between the interest rate paid on financing versus the return received on reinvested income.

IRR: Calculates the internal rate of return on an investment based on a series of periodic cash flows.

Step 1. To use the NPV Formula, start with the Excellentable you would like to edit.

NPV-1.png

Step 2. Then type the NPV formula into the cell you have chosen to display the outcome:

NPV-2.png

Step 3. Fill in the 4 values- In this example I have chosen 4 values that are the same. 

NPV-3.png

Step 4. Once saved, your completed formula will display in a confluence page like this.