Cash Flow
Calculation Formulas
u NPV | CF1 |
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| CF2 |
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| CF3 |
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| CFn | |
NPV = CF0 + |
| + |
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| + |
| + | .... | + | |||||
(1+ i ) | (1+ i )2 | (1+ i )3 | ||||||||||||
| (1+ i )n | |||||||||||||
n: natural number up to 79
uNFV
NFV = NPV ⋅ (1 + i )n
uIRR
IRR is calculated using Newton’s Method.
0 = CF0 + | CF1 |
| + |
| CF2 |
| + |
| CF3 |
| + | .... | + |
| CFn | |
(1+ i ) | (1+ i )2 | (1+ i )3 | (1+ i )n | |||||||||||||
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i = I % 100
In this formula, NPV = 0, and the value of IRR is equivalent to i ⋅ 100. It should be noted, however, that minute fractional values tend to accumulate during the subsequent calculations performed automatically by the calculator, so NPV never actually reaches exactly zero. IRR becomes more accurate the closer that NPV approaches to zero.
u PBP
PBP = | 0 .................................. | NPVn |
| (CF0 > 0) | |
| ... |
| |||
{n – NPVn+1 – NPVn | (Other than those above) | ||||
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CFk (1 + i)k
n: Smallest positive integer that satisfies the conditions NPVn <0, NPVn+1 >0, or 0.
20060301