[Verse 1] Sarah's got a project, costs a million upfront But it promises returns for years ahead She needs to know if future cash can hunt Down present value, make this venture spread Cash flows marching through the coming years But dollars tomorrow aren't worth today's price Time deflates their power, that much is clear We need a method sharp and precise [Chorus] NPV, subtract what you pay From discounted cash flows along the way If it's positive, green light the deal NPV's the gold standard, makes value real Discount rate divides future gains Present value minus cost remains NPV shows the wealth you create This method seals your project's fate [Verse 2] Take each yearly cash flow, one by one Divide by discount rate plus one, raised high To the power of years until it's done Watch future dollars shrink before your eye Year one divided by one point one Year two by that same number squared Keep going till the calculations run Through every cash flow that you've prepared [Chorus] NPV, subtract what you pay From discounted cash flows along the way If it's positive, green light the deal NPV's the gold standard, makes value real Discount rate divides future gains Present value minus cost remains NPV shows the wealth you create This method seals your project's fate [Bridge] Decision rules are crystal clean and bright Positive NPV means proceed with speed Negative numbers flash a warning light Zero means you're breaking even indeed When comparing projects, pick the highest score NPV reveals which creates more wealth This method's trusted by finance folklore Check your calculations, trust yourself [Chorus] NPV, subtract what you pay From discounted cash flows along the way If it's positive, green light the deal NPV's the gold standard, makes value real Discount rate divides future gains Present value minus cost remains NPV shows the wealth you create This method seals your project's fate [Outro] Sarah runs her numbers, finds it's positive Her project adds value to the firm NPV has spoken, now she's got to give The green light, watch her profits squirm upward
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