NPV Calculator
Calculate net present value, profitability index, and IRR for project cash flows.
Formula:NPV = Σ CFt / (1+r)^t
Key Results
NPV-2103.68
Profitability Index0.98
IRR8.90 %
Payback Period3 periods
%
$
Use a negative value for an outflow
Cash Flows
$
$
$
NPV
-2103.68
Net present value
IRR
8.90 %
Internal rate of return
Profitability Index
0.98
PV inflows / initial outflow
How we calculate
NPV discounts each cash flow by 1 / (1 + r)^t. Profitability index divides the PV of inflows by the absolute initial investment. IRR is the rate that sets NPV to zero, solved iteratively.
Quick Answer
NPV is the present value of future cash flows minus the initial investment. If NPV is positive, the project adds value at the chosen discount rate.
Key Facts
- NPV discounts each cash flow by 1 / (1 + r)^t
- Profitability index = PV of inflows / |initial outflow|
- IRR is the discount rate that sets NPV to zero
- Positive NPV suggests value creation at your chosen rate
What if the discount rate changed?
See how different discount rates affect NPV
0.0%10.0%30.0%
NPV
$-2104
IRR
8.9%
Profitability Index
0.98
Personalized Insights
2 insights based on your inputs
Negative NPV - Reconsider Project
This investment destroys $2104 in value. Consider alternatives or negotiate better terms.
Payback Period Analysis
You'll recover your initial investment in 3 periods. For liquidity-sensitive projects, shorter payback is preferred.
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Frequently Asked Questions
Use your hurdle rate, cost of capital, or required return for similar-risk projects. Higher risk typically means a higher discount rate.
A PI above 1.0 means the present value of inflows exceeds the initial outflow. Higher values generally indicate more attractive projects.
IRR is the rate that makes NPV zero. NPV tells you the value created at your chosen discount rate. Use both: NPV for absolute value, IRR for a rate comparison.
How this works
Calculations are run entirely in your browser. No inputs are sent to our servers and no account is required. Formulas follow standard US definitions from the IRS and the CFPB where applicable; international users should confirm local tax and regulatory rules apply.
What this tool can’t do
When to consult a professional
This is a software engineering tool, not financial advice. Run the math here, then take the result to a certified financial planner, CPA, or your bank before making a decision that materially affects your money.
Sources
- [1]Consumer Financial Protection Bureau (CFPB)Official sourceconsumerfinance.govAccessed Apr 21, 2026
US consumer finance regulator; authoritative on mortgage disclosures, APR rules, credit cards.
Joseph OrdunaFounder & Software Engineer
Full-stack software engineer specializing in embedded systems, web architecture, and AI/ML. Founder of Practical Web Tools. Built the gesture-controlled drone IP acquired by KD Interactive (Aura Drone, sold on Amazon).
Key Results
NPV-2103.68
Profitability Index0.98
IRR8.90 %
Payback Period3 periods