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NPV Calculator

TIME VALUE OF MONEY · NET PRESENT VALUE OF A LIST OF CASH FLOWS

Is a project worth it? Enter your discount rate and the cash flows, the first one being today, to get the net present value and what each flow is worth today.

4 cash flows over 3 periods · discounted at 10% a period, the first flow today
Example · pay 1,000 now, get 300, 400, 500

The first line is today and is not discounted; each next line is one period later. Separate flows with a new line or a semicolon, and type 1000 rather than 1,000.

Net present value

-$21.04

The flows are worth less than zero at this rate

Today value of the inflows

$978.96

Today value of the outflows

-$1,000.00

Flows added up, not discounted

$200.00

Periods

3

PeriodFlowToday value
0-1000-$1,000.00
1300$272.73
2400$330.58
3500$375.66

How to use the NPV calculator

  1. Enter the discount rate as a percent per period: the return you require, or could earn elsewhere.
  2. Type the cash flows one per line, the first one being today. Money you pay out is negative.
  3. Each next line is one period later. Use the same period as the rate (yearly flows, yearly rate).
  4. Read the net present value: above zero means the flows are worth more than they cost at that rate.
  5. Check the table to see how much each flow is worth today.

NPV formula

  • NPV = sum over t of CFt / (1 + r)^t, for t = 0, 1, 2, ...
  • The flow at t = 0 is not discounted
  • r is the rate per period, the same period as the flows

Worked example: pay 1,000, get 300, 400, 500

You pay $1,000 now and receive $300, $400 and $500 at the end of the next three years. Your discount rate is 10%:

  • 300 / 1.1 = 272.73
  • 400 / 1.1^2 = 330.58
  • 500 / 1.1^3 = 375.66
  • NPV = -1,000 + 272.73 + 330.58 + 375.66 = -$21.04

The flows add up to +$200 undiscounted, yet the NPV is slightly negative: at 10% the project does not quite pay for itself. At 8% it turns positive.

Where to go next

Want the rate at which this NPV is exactly zero? The IRR Calculator finds it. For one amount or level payments, the Present Value Calculator is simpler.

Planning a leveraged trade? Check position size, liquidation distance and funding cost before you open it:

Run Pre-Trade Risk Check

Use via API or MCP

The same calculation is available as the MCP tool workflow.run_npv: a script or an AI agent gets the exact number with the formula published, instead of a model doing the arithmetic in its head.

Get API key View API docs

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FAQ
Q.01

What is net present value?

NPV is the sum of all cash flows after each is discounted back to today. A positive NPV means the project returns more than your discount rate; a negative one means it returns less.

Q.02

What is the NPV formula?

NPV = CF0 + CF1 / (1 + r) + CF2 / (1 + r)^2 + ... where CFt is the cash flow in period t and r is the discount rate per period.

Q.03

Is the first cash flow discounted?

No. The first line is today (period 0) and counts in full. This is the textbook definition. Excel NPV() discounts its first value by one period, so to match this page there, add the first flow outside the function: =A1 + NPV(rate, A2:A5).

Q.04

What discount rate should I use?

The return you could earn on an alternative of similar risk, or your required return. NPV changes a lot with it, so test a few rates. If you want the rate at which NPV is zero, use the IRR Calculator.

Q.05

How do I enter a loss or a cost?

As a negative number: -1000 for $1,000 you pay. Type 1000 rather than 1,000, since a comma is read as part of the number and the field refuses it. Separate flows with a new line or a semicolon.

Q.06

Does a positive NPV mean the project is a good idea?

It means the flows beat your discount rate if they arrive as typed. It does not price risk in the flows themselves, taxes or the chance that forecasts are wrong.