From the course: Excel: Analyzing and Visualizing Cash Flows

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Calculate net present value given irregular inputs

Calculate net present value given irregular inputs

From the course: Excel: Analyzing and Visualizing Cash Flows

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Calculate net present value given irregular inputs

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- [Instructor] In the previous movie, I showed you how to use the NPV function to find the net present value of an investment. That function assumes that all the cash flows happen at regular intervals. Every month, every two months, every year and so on. If you have a series of cash flows that occur at irregular intervals, you need to use the XNPV function to find the net present value. I'll demonstrate how to do that in this movie. My sample file is the irregular flows workbook and you can find it in the chapter two folder of the exercise files collection. The XNPV function takes three arguments. The first is the discount rate, just called rate, which I have here in cell B3. The rate is the amount of money that you could get risk free from the investment. That could be a product line that you're very confident in, that could be a government security such as a treasury bond and so on. In this case, you're assuming 5.75%. The next set of arguments are the cash flows and the dates on…

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