Asked by
Taylor Dienert
on Nov 07, 2024
Verified
Net present value is affected by the timing of each and every cash flow related to a project.
Net Present Value
A valuation method used to estimate the attractiveness of an investment, by calculating the present value of expected future cash flows minus the initial investment cost.
Cash Flow
The overall volume of cash and cash-equivalents that are exchanged in and out of a business entity.
Timing
The selection of an optimal time or period for making an investment, launching a product, or executing a decision to maximize benefits or outcomes.
- Recognize how the timing of cash flows affects the project valuation.
Verified Answer
KN
Learning Objectives
- Recognize how the timing of cash flows affects the project valuation.