FUNCTION NPV (NET PRESENT VALUE)

This function of MS Excel calculates the net present value of an investment by using a discount rate and a series of future payments (negative values) and income (positive values).

How does it work?
=NPV(rate,value1,[value2],...)

The NPV function syntax has the following arguments (argument: A value that provides information to an action, an event, a method, a property, a function, or a procedure.):

Where:

Rate   (Required.)  The rate of discount over the length of one period.

Value1, value2, ...    Value1 is required, subsequent values are optional. 1 to 254 arguments representing the payments and income.

Value1, value2, ... must be equally spaced in time and occur at the end of each period.

NPV uses the order of value1, value2, ... to interpret the order of cash flows. Be sure to enter your payment and income values in the correct sequence.

Arguments that are empty cells, logical values, or text representations of numbers, error values, or text that cannot be translated into numbers are ignored.

If an argument is an array or reference, only numbers in that array or reference are counted. Empty cells, logical values, text, or error values in the array or reference are ignored.