# How to Calculate Net Present Value: Definition, Formula & Analysis

Instructions:

question 1 of 3

### Net present value refers to the concept that:

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### 2. Sarah is trying to determine the NPV of a simple one-time payment. Which table should she use?

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This worksheet and interactive quiz will test your understanding of net present value (NPV). Practice questions will address calculating single and multiple payment NPVs as well as their importance.

## Quiz & Worksheet Goals

In this quiz, questions will inquire regarding:

• Concepts referred to by net present value
• Computing simple NPV into a payment
• Importance of NPV
• Present value of investments
• Calculating current value of payments over time

## Skills Practiced

Students will exemplify their skills in the following:

• Problem solving - use acquired knowledge to solve for net present value in practice problems
• Interpreting information - verify that you can read information regarding the importance of NPV and interpret it correctly
• Reading comprehension - ensure that you draw the most important information about net present value from the related lesson