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Gold/Mining/Energy : Winspear Resources -- Ignore unavailable to you. Want to Upgrade?

To: Rocket Red who wrote (19877)	6/7/1999 8:09:00 PM
From: maintenance	Respond to of 26850

Hi I tried to change my handle, don't know how, gave up for now. To answer Tomato's question. NPV is calculated like this. 1 You take all the money that the firm is bringing in now and subtract from it ,all the money that is going out now. Set that aside. 2 Take all the money that will come in in one year and subtract from it all the money that is going out in one year. Divide that by ( 1 + i ). Set that aside. 3 Take all the money that will come in in two years and subtract from it all the money that is going out in two years. Divide that by (1+ i ) * (1+ i ). Set that aside. 3 Take all the money that will come in in three years and subtract from it all the money that is going out in three years. Divide that by (1+ i )(1+ i )( 1+ i ). Set that aside. 4 Keep doing that for all the years your interested in then add all the numbers you set aside. That is the NPV. Or NPV = Cf1/(1+ i ) + Cf2/(1+ i )^2 + Cf3/(1+ i )^3 + …..+Cfn/(1+ i )^n Where n is the year And i is the discount rate and Cfn is cash flow for year n Anyone following the same assumptions will get exactly the same result. The differences come from different assumptions, whether it is different assumed tax treatment, costs, production rates, or what ever. As long as the assumptions are reasonable so will be the result. Cheers