NPV Calculator — Net Present Value of a Cash Flow Stream
Who this is for: For MBA and CFA students working capital-budgeting problems, and for anyone sanity-checking whether a project, rental, or side business clears its hurdle rate before committing.
Not the right tool for: Choosing your discount rate — the WACC or hurdle rate is an input here, not an output · Projects with unequal lives — comparing them takes equivalent-annual-annuity or replacement-chain adjustments this tool doesn't make
Paste a cash flow stream and a discount rate — get net present value plus the discounted table that shows where the value comes from.
Quick answer: NPV = Σ CFₜ/(1+r)ᵗ — each cash flow divided by (1+r) to the power of its year, all added up including day zero. A project costing $5,000 today that returns $2,000 a year for 4 years has NPV = $1,339.73 at a 10% discount rate; positive means it beats the hurdle rate.
| Period | Cash flow | Discounted | Cumulative (discounted) |
|---|---|---|---|
| 0 (today) | -$1,000.00 | -$1,000.00 | -$1,000.00 |
| 1 | $500.00 | $462.96 | -$537.04 |
| 2 | $600.00 | $514.40 | -$22.63 |
| 3 | $700.00 | $555.68 | $533.05 |
| Formula | NPV = Σ CFₜ / (1+r)ᵗ, t = 0…n |
|---|---|
| Worked example | −$5,000, then $2,000 × 4 years @ 10% → NPV $1,339.73 |
| Also computed | IRR, MIRR, payback, discounted payback |
| Compiled | October 2026 |
What net present value tells you
NPV translates a whole cash flow stream into one number: today's value. Each future cash flow is divided by (1+r)^t — the discount rate r raised to the number of periods it sits in the future — and the results are added, including the day-zero flow untouched. A positive NPV means the project earns more than the discount rate; a negative one means you'd be better off at the hurdle rate. Example: −$5,000 today returning $2,000 a year for four years discounts to $1,339.73 at 10% — the project is worth $1,339.73 more than putting the same money to work at 10%. The discount rate you choose is the whole ballgame, which is why serious analysis reports NPV at two or three rates, not one.
Common uses
- Screening a capital project against the company hurdle rate
- Checking whether an annuity-like payout is worth the lump sum being asked
- Homework and case problems where the discounted table needs to be shown
- Comparing two expansions of equal life on value, not gut feel
Where these numbers come from
All results are computed in your browser from the standard closed-form formulas (and a numerical root-finder where no closed form exists — rates, IRR, YTM). Formulas follow the ordinary-annuity (END) convention used by the BA II Plus and HP 12C. Educational reference only — not investment, tax, or accounting advice.