NPV Net present value comes from the English expression Net present value. The acronym is NPV NPV English and Spanish. Dennis Carey It is a procedure used to calculate the present value of a number of future cash flows, arising from an investment. The methodology is to discount the current time (ie, updated by a fee) all future cash flows of the project. This value is subtracted from the initial investment, so that the value is the net present value of the project. The formula allows us to calculate the Net Present Value is: Vt represents the cash flows in each period t. I0 is the value of the initial investment outlay. n is the number of periods considered. The interest rate is k. If the project has no risk, they shall refer the type of fixed income, so that the NPV is estimated that the investment is better than investing in something safe, non-specific risk. In other cases, use the opportunity cost.When the van takes a value equal to 0, k renamed IRR (internal rate of return). The IRR is the return that the project is providing us.