Český finanční a účetní časopis 2006(4):23-33 | DOI: 10.18267/j.cfuc.192

Net present Value Function under Conventional and Non-Conventional Cash Flow

Petr Marek1, Jarmila Radová2
1 Doc. Ing. Petr Marek, CSc. - docent; Katedra financí a oceňování podniku, Fakulta financí a účetnictví, Vysoká škola ekonomická v Praze, nám. W. Churchilla 4, 130 67 Praha 3; <pemal@vse.cz>.
2 Doc. RNDr. Jarmila Radová, Ph.D. - vedoucí katedry, docentka; Katedra bankovnictví a pojišťovnictví, Fakulta financí a účetnictví, Vysoká škola ekonomická v Praze, nám. W. Churchilla 4, 130 67 Praha 3; <radova@vse.cz>.

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.

Keywords: Net Present Value; Internal Rate of Return; Conventional Cash Flow; NonConventional Cash Flow.
JEL classification: G40

Published: December 1, 2006  Show citation

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Marek, P., & Radová, J. (2006). Net present Value Function under Conventional and Non-Conventional Cash Flow. Czech Financial and Accounting Journal, 2006(4), 23-33. doi: 10.18267/j.cfuc.192
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