Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. Amy is an ACA and the CEO and founder of ...

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 ...

Ariel Courage is an experienced editor, researcher, and former fact-checker. She has performed editing and fact-checking work for several leading finance publications, including The Motley Fool and ...

Net present value and the profitability index are helpful tools that allow investors and companies make decisions about where to allocate their money for the best return. Net present value tells us ...

Image source: Flickr user Ken Funakoshi. A perpetual annuity, also called a perpetuity, promises to pay a certain amount of money to its owner forever. A classic example would be that of a perpetual ...

Calculate the present value of each year's cash flow by dividing by (1 + discount rate)^number of years. Sum all present values to find the total value of projected cash flows, which in this example ...

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 ...

Calculating the interest rate using the present value formula can at first seem impossible. However, with a little math and some common sense, anyone can quickly calculate an investment's interest ...

The time value of money sounds like one of those boring economic concepts that a small business owner doesn't have time for – but that would be wrong. Future value and present value are monetary ...

To find an investment's interest rate, substitute price, face value, and duration into a formula. For T-bills, subtract purchase price from face value, divide by face value, adjust for term. Online ...