The Net Present Value (NPV) Equals the difference between the present value of an investments cash

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The Net Present Value (NPV)

• Equals the difference between the present value of an investment’s cash inflows and the present value of its outflows.

• Is a valid figure of investment merit.

• When positive, indicates the investment should be undertaken.

• Is an estimate of the expected increase or decrease in wealth accruing to the investor.

• Provides a practical decision rule for managers seeking to create shareholder value.

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Analysis For Financial Management

ISBN: 9781260772364

13th Edition

Authors: Robert Higgins, Jennifer Koski, Todd Mitton

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Question Posted: Jul 23, 2024 11:02 AM

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The Net Present Value (NPV) Equals the difference between the present value of an investments cash

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Analysis For Financial Management

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