Posted on October 14, 2021 January 21, 2022

PMP Exam Prep: Present Value vs Future Value

It can be a challenge to select the next project for your team to accomplish. One project management concept that can help you make an informed decision is Net Present Value, which describes the difference between a project’s cash value now versus what it will most likely be in the future. It’s important to understand …

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Posted on September 8, 2021 January 21, 2022

PMP Exam Prep: Return on Investment (ROI)

Most organizations do not want to waste money. The Return on Investment (ROI) tool is a means to compare profits to costs to determine if funds were used effectively. ROI can be used as a predictive tool with expected profits and costs to inform future decisions, or, as an evaluation tool using known profit and …

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Posted on August 12, 2021 January 21, 2022

Net Present Value Formula PMP®

When selecting a project to pursue, it’s crucial to consider how inflation and deflation will impact your project’s future value. For example, there is a difference in the purchasing power of $1,000 today and the same amount five years in the future. The concept of Net Present Value helps PMP® credential holders account for this …

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Posted on July 14, 2021 January 21, 2022

Understanding Internal Rate of Return (IRR) for the PMP® Exam

Business professionals, including Project Managers, should have a clear understanding of the accounting term “Internal Rate of Return” (IRR) for its value in making informed financial decisions and in project selection choices. IRR is the “interest rate at which the cash inflow and cash outflow of the project equal zero” and is an economic method for …

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