discounted future benefits

Definition

Methods (such as discounted cash flow) used in computing the net present value of the income, cash flows, or societal benefits expected from an investment or environment improvement project. These methods are the reverse of the concept of compound interest, and are based on the concept of the time value of money. They try to determine what is today's worth of a dollar that is assumed to be earned or saved on a certain date in the future.

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Discounted Cash Flow Analysis end-of-year convention