by Asif Jaria
(Texas, USA)
How do you calculate net present value ignoring financing?
Comments for Calculating NPV  Ignoring Financing




by Greg Street
(Denver, CO)
Initial Investment $95000
YR Cash Inflows
1 $20,000.00
2 $25,000.00
3 $30,000.00
4 $35,000.00
5 $40,000.00
12% Discount Rate
My NPV is $9080.60...so what does that tell me?
Answer
by Anonymous
Is it good to have a high NPV?
Answer
If your NPV Analysis is based on positive cash flows then it is good. If you have not paid attention to your negative signs and you have high investment costs or net negative cash flows, then a high NPV can be bad.
The higher the real NPV is, the higher the IRR is going to be. (IRR can be looked at as interest return that you are getting) Just like you would want as high a return on your savings(investment) as possible, you want as high a NPV as possible.
by ANDREW
(NEW YORK)
What is a negative NPV?
Answer
A negative NPV means that the positive cash flows did not exceed the negative cash flows, based on the discount rate or hurdle rate that you used.
If you are comparing cash flows you want to chose the one that has the least negative or most positive NPV to maximize your economic benefit.
Try it out at NPV Calculator here.