R/net.present.value.R

In antoanne/ifmFramework: Financial evaluation of Projects

#' Difference between the present values of cash inflows and outflows
#'
#' @name net.present.value
#'
#' @aliases npv
#'
#' @param cfs A vector with a series of cash flows.
#'
#' @param interest.rate A number that represents the nominal Interest Rate,
#' presented by year.
#'
#' @param begin.of.period A boolean that represents if the Tax Rate will be
#' applied at the begining of period. FALSE by default, the Tax Rate will be
#' applied to the second period.
#'
#' @description calculates the difference between the present values of cash
#' inflows and outflows.
#'
#' @export
#'
#' @return The sum of cash flows incomes/outcomes applying the Tax Rate to the
#' present time
#'
#' @keywords presentValue
#'
#' @family financial
#'
#' @examples
#'
#' ex.npv <- net.present.value(c(-350,100,200,150,75), 0.0619, TRUE)
#'
net.present.value <- npv <-
function(cfs = c(-350,100,200,150,75),
         interest.rate = 0.0619,
         begin.of.period = TRUE)
  {
    time.instance <- if(begin.of.period) {0:(length(cfs)-1)} else {1:(length(cfs))}
    tax.rate <- (1 / ((1 + (interest.rate)) ^ time.instance))
    return (sum(cfs * tax.rate))
  }