GLOSSARY

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LaTeX Math Block
anchorPI
alignmentleft
\mbox{PI} = 1 + \frac{\mbox{NPV}}{\mbox{I}_0} = \frac{\mbox{PV}[CF^+]}{I_0}

where

LaTeX Math Inline
body--uriencoded--\mbox%7BNPV%7D

Net Present Value

LaTeX Math Inline
body--uriencoded--\mbox%7BI%7D_0

Initial Investment

LaTeX Math Inline
body--uriencoded--CF%5e+ = \%7B CF%5e+_0, \ CF%5e+_1, \ CF%5e+_2, \ ... \%7D

Cash Inflows


The key difference with NPV is that PI shows a value of returns per unit cash invested.  

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