Depreciation is not included in Net Present Value analysis because it is:

Name: Depreciation is not included in Net Present Value analysis because it is:
Brand: Quizplus
Rating: 4.7 (50 reviews)

Question

Quizplus · Accepted Answer

Depreciation is a non-cash item as it represents the allocation of the cost of a long-term asset over its useful life. Since net present value analysis is focused on cash flows, only actual cash flows are considered in the analysis. Therefore, depreciation is not included in NPV analysis.

Depreciation Is Not Included in Net Present Value Analysis Because