What is the sum of the present values of all cash flows (inflows and outflows) called?

Question

Quizplus · Accepted Answer

The sum of present values of all cash flows is known as net present value (NPV). Costs of capital, internal rate of return (IRR), and required rate of return are all concepts used in capital budgeting, but they do not refer specifically to the sum of present values of cash flows. Therefore, the best choice is C, net present value.

What Is the Sum of the Present Values of All