Business A-Level
Net Present Value (NPV)
What Net Present Value (NPV) means in Business A-Level, as defined for Pearson Edexcel.
Definition of Net Present Value (NPV)
The sum of the discounted future cash flows of an investment minus the initial cost, accounting for the time value of money.
Topics that use Net Present Value (NPV)
- Decision-making techniques (Pearson Edexcel A-Level)
Related terms
Using Net Present Value (NPV) in the exam
Definition questions usually carry one or two marks, and examiners look for the precise wording. Write the definition from memory, check it against the version above, and then use the term in a longer answer on the same topic so it sticks.
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