How Institutional factors of influencing productivity in agriculture

A:
net present value (npv) is a method used to determine the current value of all future cash flows generated by a project, including the initial capital investment. it is widely used in capital budgeting to establish projects are likely to turn the greatest profit.

the formula for npv varies depending on the number and consistency of future cash flows. if there’s one cash flow from a project that will be paid one year from now, the net present value is calculated as follows:

npv=cashflow/(1+i)t-initial investment

in equation:

i = required return or discount rate

t = number of time periods