Asked by Jeanette Avila on Jul 08, 2024
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In net present value analysis for a proposed capital investment, the expected future net cash flows are reduced to their present values.
Net Present Value
A calculation used to determine the value of a series of future cash flows discounted back to the present day, often employed in capital budgeting to assess the profitability of an investment.
Future Net
The projected net value or income of an investment or business activity after accounting for all anticipated costs and revenues.
Present Values
The current value of a future sum of money or stream of cash flows given a specified rate of return.
- Understand thoroughly the framework of net present value analysis and its implications for strategic capital investments.
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Learning Objectives
- Understand thoroughly the framework of net present value analysis and its implications for strategic capital investments.
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