Net present value and the profitability index are helpful tools that allow investors and companies make decisions about where to allocate their money for the best return.

Learn how to calculate the net present value (NPV) of your investment projects using Excel's XNPV function.

How to Calculate the Profitability Index To calculate the profitability index, you first need to determine the present value of the expected future cash flows from the investment.

Net present value and the profitability index are helpful tools that allow investors and companies make decisions about where to allocate their money.

Understanding the Profitability Index The PI is a financial tool that helps investors assess the potential profitability of a project or investment. It’s calculated by dividing the present value ...