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Introduction Net Present Value is a financial measure used to evaluate the profitability of an investment or project. If an NPV is positive, it suggests that the investment is profitable to the investor, while a negative NPV indicates potential losses. It helps in decision-making by considering the cost of capital and determining whether an investment adds value to the business.

Introduction Net Present Value is a financial measure used to evaluate the profitability of an investment or project. If an NPV is positive, it suggests that the investment is profitable to the investor, while a negative NPV indicates potential losses. It helps in decision-making by considering the cost of capital and determining whether an investment adds value to the business.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Introduction

Net Present Value is a financial measure used to evaluate the profitability of an investment or project. If an NPV is positive, it suggests that the investment is profitable to the investor, while a negative NPV indicates potential losses. It helps in decision-making by considering the cost of capital and determining whether an investment adds value to the business.

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