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Net present Value Function under Conventional and Non-Conventional Cash Flow
[Funkce čisté současné hodnoty při konvenčních a nekonvenčních peněžních tocích]

Author

Listed:
  • Petr Marek
  • Jarmila Radová

Abstract

The aim of the article is a mathematical derivation of rules for construction of net present value function given the assumption of conventional and non-conventional cash flows. For non-conventional cash flows the following combinations of positive (+) and negative (-) cash flows have been considered for NPV function construction: (+, -, +), (-, +, -), (+, -, +, -), (+, -, +, -, +). The article also attempts to indicate the most frequent mistakes in calculation and interpretation of the function.

Suggested Citation

  • Petr Marek & Jarmila Radová, 2006. "Net present Value Function under Conventional and Non-Conventional Cash Flow [Funkce čisté současné hodnoty při konvenčních a nekonvenčních peněžních tocích]," Český finanční a účetní časopis, Prague University of Economics and Business, vol. 2006(4), pages 23-33.
    • Handle: RePEc:prg:jnlcfu:v:2006:y:2006:i:4:id:192:p:23-33
    DOI: 10.18267/j.cfuc.192
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    References listed on IDEAS

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    1. James H. Lorie & Leonard J. Savage, 1955. "Three Problems in Rationing Capital," The Journal of Business, University of Chicago Press, vol. 28, pages 229-229.
    2. Daniel Teichroew & Alexander A. Robichek & Michael Montalbano, 1965. "An Analysis of Criteria for Investment and Financing Decisions Under Certainty," Management Science, INFORMS, vol. 12(3), pages 151-179, November.
    3. K. E. Boulding, 1935. "The Theory of a Single Investment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 49(3), pages 475-494.
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