NPV

The numerical values representing the expected net cash flow used to compute the net present value. This can be a row, a column, a cell range, or an expression evaluating to any of the above.

rate

The numerical value representing the rate of discount over the length of one period.

keyword

This optional keyword determines how the computation is performed over the input data range. If no keyword is provided, ROW is used as the default. Select one of the following:

COL - Performs the computation separately for each column of data

ROW - Performs the computation separately for each row of data

Description

NPV calculates the net present value of an investment based on a series of periodic cash flows and a discount rate. The net present value of an investment is today's value of a series of future payments (negative values) and income (positive values). NPV is calculated by the formula:

where n is the number of cash flows (data values).

The order of the data values is used to interpret the order of the cash flows. The NPV investment begins one period before the date of the first cash flow value and ends with the last cash flow in the list.

If your first cash flow occurs at the beginning of the first period, the first value must be added to the NPV result, not included in the data values.

The number of columns returned by NPV depends on keyword.

If keyword is COL, NPV returns a new column for each input column. Each new column contains one value (the net present value of all cells in the corresponding input column).

If keyword is ROW, NPV returns one new column containing the net present value across each row of data.

Blank cells are ignored in the NPV.

Examples

TEMP = NPV(V1:V3,.10)) or TEMP = NPV(V1:V3,.10, ROW)

Creates a new column named TEMP containing a single value which is the NPV of the values of columns V1, V2, and V3. The discount rate used is 10%.

TEMP = NPV(V1, .10, COL)

Creates a new column named TEMP containing a single value which is the NPV of the contents of column V1 using a discount rate of 10%.

TEMP = NPV(V1:V3, .10) - 1000

Creates a new column named TEMP containing a single value which is the NPV of the contents of columns V1, V2, and V3 with an initial payment of 1000. The discount rate is 10%.

TEMP = NPV(V1[10:20], .10L, COL)

Creates a new column named TEMP containing a single value which is the NPV of the cells in rows 10-20 of column V1. The discount rate is 10%.

TEMP = NPV(V1[1:5]:V4, .10)

Creates a new column named TEMP containing a single value which is the NPV of the cells in rows 1-5 of columns V1 through V4.