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Tag: NPV function

NPV function: Description, Usage, Syntax, Examples and Explanation

What is NPV function in Excel? NPV function is one of the Financial functions in Microsoft Excel that calculates the net present value of an investment by using a discount rate and a series of future payments (negative values) and income (positive values). Syntax of NPV function NPV(rate,value1,[value2],…) The NPV function syntax has the following arguments: Rate: The rate of discount…

How to calculate Net Present Value (NPV) in Excel

NPV formula for net present value To calculate Net Present Value (NPV) you can use the NPV function. Formula =NPV(rate,cashflows)-initialcost Explanation In the example shown, the formula in F6 is: =NPV(F4,C6:C10)+C5 How this formula works Net Present Value (NPV) is the present value of expected future cash flows minus the initial cost of investment. The NPV function in Excel only…