Real vs. Nominal and Net Present Value

2 years ago, Ben Ackles, the user of Slideshar had made and uploaded following presentation in which he explained Real NPV and Nominal NPV with suitable examples. He said that because of inflation, a dollar tomorrow typically does not buy as much as a dollar today. I learnt that NPV > 0 stream of cash flows are a “good deal” in that the PV of benefits exceeds the PV of costs; “you’re doing better than just investing at r” and  NPV < 0 stream of cash flows are a “bad deal”. I also found this presentation educational, so watch and understand it.

Real vs. Nominal & Net Present Value

View more presentations from Ben Ackles.