Excel NPV function
Calculates the present value of a series of future cash flows at a discount rate. In Spanish Excel it is called VNA.
Syntax
English Excel
=NPV(rate, value1, [value2], …)
Spanish Excel (Mexico)
=VNA(tasa, valor1, [valor2], …)
Spanish Excel (Spain, Latin America)
=VNA(tasa; valor1; [valor2]; …)
| Argument | What it is |
|---|---|
| rate | The discount rate per period. |
| value1 | The cash flows, from period 1 on. |
| value2optional | More cash flows. |
Example
NPV(rate, cash flows) brings future cash flows to today. Careful: it discounts from the first flow, so the initial investment (year 0) is added separately. A positive result means the project beats the rate.
=NPV(B1,B5:B8)+B4
Common mistake
NPV discounts the first flow too. Add the initial investment (period 0) outside: =NPV(rate,flows)+investment.
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Practice NPV
Type the formula in the sheet and check it instantly. Spanish or English function names both work. See all lessons
Net present value with NPV
NPV(rate, cash flows) brings future cash flows to today. Careful: it discounts from the first flow, so the initial investment (year 0) is added separately. A positive result means the project beats the rate.
In B10, calculate the net present value: NPV of years 1 to 4, plus the year 0 investment.
| A | B | C | |
|---|---|---|---|
| 1 | Discount rate | 10% | |
| 2 | |||
| 3 | Year | Cash flow | |
| 4 | 0 | -50,000.00 | |
| 5 | 1 | 15,000.00 | |
| 6 | 2 | 18,000.00 | |
| 7 | 3 | 20,000.00 | |
| 8 | 4 | 12,000.00 | |
| 9 | |||
| 10 | NPV | ||
| 11 |
Tip: while typing, click a cell or drag across several to insert their reference. F4 anchors the reference with $.
Frequently asked questions
- What is NPV called in Spanish?
- In Spanish Excel it is VNA. The formula =NPV(B1,B5:B8)+B4 is written =VNA(B1;B5:B8)+B4 (or with commas in Mexico).
- Why does NPV use semicolons in some Excel versions?
- It depends on regional settings. Where the comma is the decimal mark (Spain, much of South America), Excel separates arguments with semicolons. English Excel and Mexican Spanish Excel use commas.
- What is the most common NPV mistake?
- NPV discounts the first flow too. Add the initial investment (period 0) outside: =NPV(rate,flows)+investment.