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The Corporate Finance Institute Excel
What is the XNPV formula?
The XNPV formula is Excel requires the user to select a discount rate, a series
of cash flows, and a series of corresponding dates for each cash flow.
The Excel formula for XNPV is:
=XNPV(Rate, Cash Flows, Dates of Cash Flow)
The XNPV function uses the following three components:
1. Rate – The discount rate to be used over the length of the period (see
hurdle rate and WACC articles to learn about what rate to use).
2. Values (Cash Flows) – This is an array of numeric values that represent the
payments and income where:
• Negative values are treated as outgoing payments (negative cash
flow).
• Positive values are treated as income (positive cash flow).
3. Dates (of Cash Flows) – It is an array of dates corresponding to an array of
payments. The date array should be of the same length as the values array.
The function uses the following equation to calculate the Net Present Value of
an investment:
Where:
d i = the i‘th payment date
d 1 = the 0’th payment date
P i = the i‘th payment
Please see the example below for a detailed breakdown of how to use XNPV in
Excel.
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