NPV Calculator
Net present value of an investment from its cash flows and a discount rate.
Best for: Use it to compare projects, value an investment or business, or decide whether expected cash flows justify an upfront cost.
Purpose: Net present value of an investment from its cash flows and a discount rate.
Input
Result
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- Type
- Industry Standard
- Method
- Industry-standard method
- Confidence
- High
Uses the standard formula and conventions the industry relies on.
A positive NPV means the investment adds value at the rate you chose; zero means it exactly meets that rate; negative means it falls short. The result is very sensitive to the discount rate.
- Inflation often matters more than expected over the long run.
- Small rate changes can significantly affect total outcomes.
- Long-term consistency usually beats short-term timing.
Small, consistent changes compound: time in the market usually beats timing the market.
How it's calculated & sources
Free & no sign-up · runs entirely in your browser. Results are estimates for general information, not professional advice — verify important decisions with a qualified expert. Last reviewed June 2026.
How it works
NPV = −C₀ + Σ Cₜ ÷ (1 + r)t — C₀ = initial investment, Cₜ = year-t cash flow, r = discount rate. A positive NPV means the return beats your discount rate.
Example
Invest $10,000 at 10%, cash flows $3k/$4k/$5k/$4k over 4 years → NPV ≈ +$2,522 (positive → worth it).
Frequently asked questions
What discount rate should I use?+
Usually your cost of capital or the return you could earn elsewhere at similar risk. A higher rate lowers NPV; the rate that makes NPV zero is the internal rate of return (IRR).
Do I enter the initial cost as negative?+
Enter it as a positive number in the Initial investment box — the calculator subtracts it as the year-0 outflow. The cash-flow list is years 1 onward.
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