Net present value (NPV) represents the difference between the present value of cash inflows and outflows over a set time period. Knowing how to calculate net present value can be useful when ...

As mentioned, net present value is not specific to investing in stocks or other securities. Businesses can also use net present value formulas to determine where to allocate their capital.

Net present value lets you value a stream of future payments into one lump sum today, as you see in many lottery payouts. Present value tells you the current worth of a future sum of money.

The net present value (NPV) method can be a very good way to analyze the profitability of an investment in a company, or a new project within a company.

What's the NPV? NPV stands for net present value, and it is an accounting calculation that every lender makes about each loan that is reviewed for a possible loan modification.