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The larger the reserve requirement,the
Net Present Value (NPV)
Net Present Value is the difference between the present value of cash inflows and outflows over a period of time, used in capital budgeting to assess the profitability of an investment.
Present Value
The worth at present of future monetary sums or cash flow streams, evaluated with a preset rate of return.
Cash Flows
The sum of funds flowing in and out of a company, particularly as it influences liquidity.
Capital Budgeting Project
A process of evaluating and selecting long-term investments that are expected to generate revenues or reduce costs, aiding in a firm's strategic planning.
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