Net present value (commonly referred to as "NPV") is a financial term that measures the value today (that is, the "present" value) of future assets and liabilities. The concept is essential in numerous areas of business and personal finance. Although it is possible to calculate by hand, the easiest way to find net present value is to use a financial calculator.
Step 1
Press the "FV" key on the financial calculator.
Step 2
Enter the future value of the future asset or liability. For example, if you are trying to calculate the NPV of a $10,000 payment you will receive in a few years, enter "10000" into the financial calculator.
Step 3
Press the "NPER" key (labeled the "N" key on some financial calculators).
Step 4
Enter the time period of the future asset. For example, if the payment will be received 10 years in the future, enter the number "10."
Step 5
Press the "%i" key (sometimes labeled as the "I" key on certain calculators) and enter the interest value.
Step 6
Press the "NPV" key. This will immediately find the net present value for the future asset or liability based upon the information that you inputted.