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@wikipedia


Popular mechanism of assessing the present value of the future cash flows

LaTeX Math Inline
body--uriencoded--CF = \%7B CF_t \%7D_%7Bt = 0..T%7D = \%7B CF_0, \ CF_1, \, CF_3 \ ... , \ CF_N \%7D
 with account of discount rate.


LaTeX Math Block
anchorLMNJ8
alignmentleft
\mbox{PV}_r[CF] = \sum_{t=0}^N \frac{\mbox{CF}_t}{(1+r)^t}

where

LaTeX Math Inline
bodyT

total number of accounting periods (usually years)

LaTeX Math Inline
bodyr

discount rate



It also works as a popular mechanism of quantifying the discounted
 value of the future Asset Market Value:

...