When you discount the company’s future cash flows to their Present Value, you use periods such as 1, 2, 3, and 4 in a standard DCF analysis: In other words, to calculate the Present Value (PV) of a Free Cash Flow generated in Year 3, you use this formula: ...
Capital Recovery Factor – Meaning, Formula, and Example Capital Recovery Factor (or CRF) is the ratio that helps to find the present values of a series of equal payments. The equal payments…Read Article Perpetuity Meaning of PerpetuityPerpetuity is a never-ending stream of cash flows from an...