O'Reilly logo

Microsoft® Excel Data Analysis and Business Modeling by Wayne L. Winston

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

Chapter 8. Evaluating Investments with Net Present Value Criteria

  • What is net present value (NPV)?

  • How do I use NPV to compare the merits of investments for which cash flows are received at several points in time?

  • How do I use the Excel NPV function?

  • How can I compute NPV when cash flows are received at the beginning of a year or in the middle of the year?

  • How can I compute NPV when cash flows are received at irregular intervals?

Consider the following two investments, whose cash flows are listed in the file NPVExample.xls and shown in Figure 8-1.

To determine which investment is better, we need to calculate net present value.

Figure 8-1. To determine which investment is better, we need to calculate net present value.

  • Investment 1 ...

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required