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The PDV formula, also known as Present Discounted Value formula, is used in financial analysis to calculate the current value of future cash flows. It takes into account the time value of money by discounting future cash flows back to their present value. By applying the PDV formula, analysts can evaluate the profitability and risk associated with an investment or project by determining its net present value. This helps in making informed decisions about whether to proceed with the investment based on its potential returns compared to the initial cost.

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4mo ago

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