Question: There are 3 main indicators that can be used for comparative purposes. The net present value (NPV) is the sum of the discounted cash flows.

There are 3 main indicators that can be used for comparative purposes. The net present value (NPV) is the sum of the discounted cash flows. If there is a cash flow at the beginning of the project, it is usually not discounted. Unless using a discount rate that reflects the actual cost of equity and funding, the NPV should not be used as an absolute figure, but for comparison purposes only.

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