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Excel NPV Function

Author: Amanda Li Last Modified: 2022-02-17

The NPV function returns the net present value of an investment based on a discount or interest rate and a series of future cash flows: payments (negative values) and income (positive values).

npv function 1


=NPV(rate, value1, value2, …)


  • rate (required): The discount or interest rate for a period
  • value1 (required): Required numeric value that indicates future cash flows.
  • value2, … (optional): Optional numeric values that indicate future cash flows.

Return Value

The NPV function returns a numeric value.

Function Notes

  • Use negative values to represent outflows (payments) and positive values to represent inflows (returns).
  • Values must be equally spaced in time, and occur at the end of each period. If the first cash flow occurs at the beginning of the first period, the first value should not be included in the values arguments, but added to the formula’s result.
  • All numerical values will be processed, including those that can be translated into numbers, for example, dates and logical values. Error values or text that cannot be translated into numbers will be ignored.

Example (Initial cost happens at the end of the first period)

To get the net present value for an investment with the information shown in the table below, please copy or enter the formula below in a blank cell, and press Enter to get the result:


npv function 2

Example (Initial cost happens at the beginning of the first period as it typically does)

In the example above, the initial cost happens at the end of the first period. However, the initial cost normally occurs at the start of the first period. In this case, we should not include it in the NPV formula, but add it to the formula result:


npv function 3

Related functions

Excel PV Function

The PV function returns the present value of an investment.

Excel XNPV Function

The XNPV function calculates the net present value for irregular cash flows.

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