Principles and Applications of Net Present Value
Автор: Sameer Alrishani
Загружено: 2026-01-24
Просмотров: 1
The video outlines the net present value (NPV) method, a critical financial tool used in capital budgeting to evaluate potential investments by accounting for the time value of money. This technique functions by discounting projected cash flows back to their current value using a specific interest rate, often determined by a company's cost of capital. Management considers a project financially viable if the resulting calculation yields a zero or positive figure, indicating the return meets or exceeds expectations. Conversely, a negative result signals that an investment should be rejected because it fails to reach the required minimum rate of return. The evaluation process assumes that all future earnings are predictable and will be reinvested immediately at a similar rate. Ultimately, this approach allows decision-makers to prioritize projects by identifying those with the highest positive valuation.
Доступные форматы для скачивания:
Скачать видео mp4
-
Информация по загрузке:
