INDICATORS

SIMILARITIES

Net Actual Value or Net Compares the amount

Present Value: NAV or you have invested
NPV
today with the future
returns after it has
been discounted by a
particular rate of return

Internal Rate of Return Is an interest rate at

which you can ensure
IRR
that your investment
makes more money
than its actual cost

Unique Rate of Return,

Real Profitability Rate: Compare income
statement accounts
URR o RPR
and categories to show
a company's ability to
generate profits from
its operations

Equivalent Unified
Annual Cost: EUAC

Is the cost per year of

owning and operating
an asset over its entire
lifespan

Cost Benefit Relation;

B/C

Provide a basis for

comparing projects. It
involves comparing the
total expected cost of
each option against the
total expected benefits,
to see whether the
benefits outweigh the
costs, and by how
much

DIFFERENCES

NPV calculation uses

different discount rates,
then it produces different
results for the same
project.

USES AND
APPLICATIONS

Is a tool used to
determine whether a
project is worth the
investments made

Is a formula used to
calculate your
investments
IRR assumes that thecashprofitability
flows are reinvestedin the projected at the same dis

Basically show how well

companies can achieve
profits from their
operations.

Used to assess a business's ability to generate earning

Equivalent unifield
annual cost is often
used by firms for capital
Is often used as a decisionbudgeting
making tool
decisions.
incapital budgetingwhen comparing inv

Is a systematic approach
to estimating the
strengths and
weaknesses of
alternatives that satisfy
transactions, activities or
functional requirements
for a business

Used by governments
and other organizations,
such as private sector
businesses, to appraise
the desirability of a
given policy