The method that compares the present value of a project's future cash flows to the initial investment is

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The method that compares the present value of a project's future cash flows to the initial investment is the net present value (NPV). The NPV method takes into account the time value of money and gives a more accurate representation of a project's profitability than methods such as accounting rate of return or payback period. The goal of any investment should be to maximize NPV, so choosing the project with the highest NPV is the best option.

The Method That Compares the Present Value of a Project's