Investments normally require upfront payments that lead to expected future benefits. Calculating net present value and internal rates of return are essential to determine projects that generate future cash flows. NPV finds the nominal value of a project while IRR finds the minimum required rate of return.
Key learning objectives:
What is NPV and what are its shortcomings?
What is an IRR?
Introduction to Options, Pricing and Use Cases
Peter Eisenhardt • 13:18