Net present value (NPV) represents the difference between the present value of cash inflows and outflows over a set time period. Knowing how to calculate net present value can be useful when choosing ...

NPV calculates profitability using all projected cash inflows and outflows, considering time value of money. A positive NPV suggests a profitable project; a negative NPV suggests a loss. NPV's ...

Chris Gallant, CFA, is a senior manager of interest rate risk for ATB Financial with 10 years of experience in the financial markets. Suzanne is a content marketer, writer, and fact-checker. She holds ...

Discover how businesses and government agencies can use capital investment analysis to assess the potential of long-term ...

Too many financial decisions are made without factoring in the time value of money. Whether providing financial planning advice related to a client’s retirement, advising a client about a business ...

Present value is a useful mathematical formula designed to figure out if money received now is worth more than money received later. What Is Present Value? Terms Associated With the Present Value of ...

Businesses must observe proper procedures when undertaking long-term investments to ensure the projected payoff is worth the resource allocation. Capital investments are costly and their benefits are ...

Capital budgeting decisions are among the most important decisions a business owner or manager will ever make. Which assets to invest in, which products to develop, which markets to enter, whether to ...

Opinions expressed by Entrepreneur contributors are their own. We recently helped a client think through whether or not to invest in new technology to reduce the cost of doing business. Specifically, ...