Chapter 14: Applications 397
Calculating Cash Flows
Calculating Cash FlowsCalculating Cash Flows
Calculating Cash Flows
Calculating a Cash Flow
Calculating a Cash FlowCalculating a Cash Flow
Calculating a Cash Flow
Use the cash flow functions (menu items
7 and 8) to analyze the value of money over
equal time periods. You can enter unequal cash flows, which can be cash inflows or
outflows. The syntax descriptions for
npv( and irr( use these arguments.
•
interest rate is the rate by which to discount the cash flows (the cost of money) over
one period.
•
CF0 is the initial cash flow at time 0; it must be a real number.
•
CFList is a list of cash flow amounts after the initial cash flow CF0.
•
CFFreq is a list in which each element specifies the frequency of occurrence for a
grouped (consecutive) cash flow amount, which is the corresponding element of
CFList. The default is 1; if you enter values, they must be positive integers < 10,000.
For example, express this uneven cash flow in lists.
CF0 = 2000
CFList = {2000,L3000,4000}
CFFreq = {2,1,2}
2000 4000 40002000 2000
-3000
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