Discounted cash flow technique
Discounted cash flow technique (alternatively known as DCF technique) is the net present value (NPV) and internal rate of return (IRR) technique is discounted cash flow (DCF) evaluation technique. These techniques are called DCF methods because they explicitly recognize the time value of money.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- DCF technique (discounted cash flow technique). The net present value (NPV) and internal rate of return (IRR) technique is discounted cash flow (DCF) evaluation technique. These techniques are called DCF methods because they explicitly recognize the time value of money.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
