The Net Present Value (NPV) is maybe the most commonly used technique for evaluating a potential investment opportunity. Using this technique all cash flows in a business case at the opportunity cost of capital. The pros- accounts for the fat that the value of a dollar today is more than the value of a dollar received a year from now- that is the time of money concept. Another pro is that is that it recognizes the risk associated with future cash flow, its less certain. Cons- is that it does not give visibility into how long a project will take . . .
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