Lesson 4: Net Present Value (NPV) - Forest and Range
Present Value of an Annuity n The present value of an annuity can be calculated by taking each cash flow and discounting it back to the present, and adding up the present values. Alternatively, there is a short cut that can be used in the calculation [A = Annuity; r = Discount Rate; n = Number of years] PV of an Annuity = PV(A,r, n) = A 1 - 1 ................
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