NPV calculations at the end of future years

[Guest]

Do I use the net present value function (PV) to get an answer of (negative)
-37,565 if we have a cash outflow of $50,000 at the end of the 3rd year at a
10% factor?

I am using a text book and chart, but I’d like to be able to use excel to
calculate it. Once again, the text’s answer is (37,565).

Thank you for your help.

 

[Niek Otten]

NPV is for a series of payments.

Use

=50000/(1+10%)^3

 

[Guest]

Yes, use PV: =PV(10%,3,0,50000). The PV function arguments are the periodic
rate, the number of periods, the payment made each period (none, since you
have a single cash outflow), and the future value (50000, since that's the
value at the end).