Clear Current value

In the case of the Investment, the clear current value (VAN) is the difference between

the brought up to date capacities in self-financing (= current value ) which will bring this investment,
and the capital invested.

A positive V.A.N determines if the investment can be undertaken.

$V_ {Current Clear} = \ sum_ {p=1} ^ {p=N} C_ {Self-financing}. (1+t) ^ {- p} - I= \ sum_ {p=1} ^ {p=N} C_ {AutoFinancement \ Brings up to date} - I$

With

C_{AutoFinancement} capacity of self-financing obtained,
T the Rate up-dating,
p the number of the annual installment,
NR the full number of annual installments,
I the funded capital,
C_{AutoFinancement Actualisé} capacity of self-financing obtained brought up to date.

On the other hand, this evidence alone does not make it possible to appreciate a Investissement fully, because between several investments with equal VAN , a high starting capital will be less profitable.

Rate of profitability interns (TRI)

If one has the other data in the equation above, one can calculate the rate T which is thus the Rate of profitability interns

Time of recovery of the funded capital

The time of recovery of the funded capital is the number of years, month until the office plurality of the capacities of self-financing updated reaches the funded capital.

A short time is a criterion for a interesting Investissement because that facilitates in particular the forecasts, as well as the stability of the company.

See too

Actualization
Index of profitability and favors relative
Rate of profitability interns

External bonds

Calculation of the clear current value

Random links: