NPV
NPV('Rate', 'Cashflow' [, "Level"])
The NPV function calculates the net present value of an investment by using a discount rate and a series of future payments and income.
Use this function when the discount rate is known and you want to calculate the net present value of a cash flow series.
Parameters
- RateNode referenceRequired
- The rate of the discount over the time of the period.
- CashflowNode referenceRequired
- Series of payments or income. Negative values represent outgoing payments and positive values represent incoming payments.
- LevelLevel nameOptional
- The period of time or a sequence over which the calculation is going to be made. If the level is not provided, the lowest time level from
'Cashflow'is selected.
Watch out
'Cashflow'is the leading input node. Its levels define the result’s shape, except the dimension of the discounting"Level", which is aggregated away.- Rate values are percentages and must be entered and returned as decimals, for example
10% = 0.1. - If a
"Level"is entered, it should be a level of the'Cashflow'node. It should also be the lowest level in the dimension that is found in'Cashflow'. - The levels from the
'Rate'input node need to be available in the'Cashflow'input node. - Any level that is in the same dimension as the selected
"Level"from the'Cashflow'node cannot be available in the'Rate'input node. That also counts for all linked levels in this dimension. - The
'Cashflow'data cannot have missing values.
Example
Discount cash flows by region
This example shows how a rate node and a cashflow node are combined to calculate net present value by region. The result is aggregated over the year level.
Input node: 'Cashflow'
| Year | Region | Value |
|---|---|---|
| 2025 | Asia | +500 |
| 2026 | Asia | -100 |
| 2027 | Asia | +200 |
| 2025 | Europe | -100 |
| 2026 | Europe | +400 |
| 2027 | Europe | +500 |
Input node: 'Rate'
| Region | Value |
|---|---|
| Asia | 0.05 |
| Europe | 0.1 |
Formula: NPV('Rate', 'Cashflow')
Equivalent to: NPV('Rate', 'Cashflow', "Year")
| Region | NPV Result |
|---|---|
| Asia | 558.26 |
| Europe | 615.33 |