Internal Rate of Return, Cash Flow, and NPV

Calculating and Interpreting Internal Rate of Return (IRR) This post continues a discussion about cash flow, net present value, and interest rates and NPV, which you can read by clicking on the specific links. This post deals with the topic of internal rate of return. IRR is an indicator of the efficiency or quality of … Continue reading Internal Rate of Return, Cash Flow, and NPV

Determining Net Present Value of Cash Flow

We started a discussion on the importance and description of cash flow for the operating firm. You can find that post here: cash flow intro. Moving forward now to the topic of net present value of cash flow (or NPV). An investment project generally should be undertaken if benefits outweigh costs. In order to compare … Continue reading Determining Net Present Value of Cash Flow

NPV and Interest Rates for Discount Purposes

Net Present Value and Sensitivity to Interest Rates This post continues a discussion about cash flow and net present value which you can read by clicking on the specific links. This post deals with a major factor on NPV which is the fluctuating interest rate. This variable can change outlook in a hurry. The NPV … Continue reading NPV and Interest Rates for Discount Purposes

Project Evaluation – Cash Flow Analysis Intro

Cash flow analysis is one of the most important pieces of financial information for a firm. Before approving a loan banks analyze the cash flow of firms to decide whether the companies have the ability to repay a loan. As well, the cash flow analysis before an investment project is crucial in order to decide … Continue reading Project Evaluation – Cash Flow Analysis Intro

Project Evaluation – Sensitivity Analysis (Cash Flow)

This post continues a discussion about cash flow, net present value, interest rates and NPV, and IRR, which you can read by clicking on the specific links. This post deals with the topic of project evaluation. The main methods used for project evaluation are the NPV method and the IRR method. According to them, an … Continue reading Project Evaluation – Sensitivity Analysis (Cash Flow)