The cost of capital is inversely proportional to the NPV.

As capital costs increase (i.e. the interest rate increases), NPV decreases.

As capital costs decrease (i.e. the interest rate decreases), NPV increases.

You can see the relationship in the following equation:

NPV = a * ((1+r)^y - 1)/(r * (1+r)^y)

Where:

NPV = Net Present Value (The present value of a future amount, before interest earnings/charges)

a = Amount received per year

y = Number of years

r = Present rate of return

no it increases npv

* matches anything. *.jpg would mean any file with a .jpg extension. 1*.jpg would mean any file where the name begins with 1 and ends with a .jpg ? matches any single character. ?.jpg would match a.jpg, 1.jpg, or F.jpg but not a1.jpg. Several ? wildcards can be used so that ??.jpg would match any jpg file with a two letter name.

NPV decreases when the cost of capital is increased.

NPV=NFV/(1+r)^n The role of the "(1+r)^n" is to discount the future money to what it is worth in todays dollars. The 1 accounts to the sum itself and the plus r takes into account the interest rate. NPV=NFV/(1+r)^n The role of the "(1+r)^n" is to discount the future money to what it is worth in todays dollars. The 1 accounts to the sum itself and the plus r takes into account the interest rate.