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The order of Payments

True or false: "when computing an NPV, it does not matter if high inflows occur after low inflows or vice versa - the order payments has no effect on the NPV" why?

what is high inflows and low inflows?? and vice versa??

please explain the concept.


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Solution Preview

The statement is true. The order of Payments has no effect on NPV since it discounts all the payments to present value that is to Day 0.

High inflows are the major big cash inflows during the project life and low inflows are small cash inflows during the life of the ...

Solution Summary

The order of Payments is overviewed.