Get the Net Present Value of a Project Calculation - Finance in Excel - NPV()

[grandestberry]

thank you!

[JuseJamez]

Thanks Homie!



[JuseJamez]

I never saw you add the inflation to see how it fits into the function.

[marduktr]

what shall i do to find the discount rate of a project? wacc?

[ExcelisHell]

@marduktr That's one way to do it. It really just depends on the type of project or, more often, what someone tells you to use.

[PetiteOzma]

@ExcelisHell I'm working on an assignement right now for capital budgeting and they didn't give me a discount rate just the WACC... the instructions say that the company considers the project equally risky to the company itself so WACC should be the discount rate then?

[ExcelisHell]

@PetiteOzma Sounds about right to me :)

[speakingofdevil]

Hi, I wonder how to calculate cash inflow and outflow if I have an initial $2,000,000 for 10 years with 15%?

[reezthegr8]

Thanks dude...

[dizzybone2000]

excellent

[TheBatanoni]

what is that real int = nominal int - inflation

it is very simple why u make it complicated !

[sasamuraki]

i would rather go with his formula - in ur case (a common misconception) it only works if the inflation is trivial.. if it is bigger, it will make a huge difference.. when talking thousands or millions, those decimals matter.. :)

[ExcelisHell]

@sasamuraki It is the difference between academics and the real world.

[sasamuraki]

yeah exactly...

[faikumiee]

THANK YOUUU!!!!

[svtuition]

I think you have minus from present value of cash inflow

because NPV = PV of cash inflow - PV of cash outflow.

Am I right Sir

[ExcelisHell]

Yes but this is using the NPV() function in Excel and the numbers that are 'added' such as Period 0 are negative within the spreadsheet so it is the same as subtracting that number. You could actually calculate the NPV by hand in Excel if you wanted to create all of the necessary math formulas but that is just not as efficient as using the NPV() function.

[nreynard2000]

great tutorial!!!

[EzE3000]

Great teaching

[DIPFM2009]

excellent training. I must check out more from these guys.

[vdarius77]

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