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What is Discounted Cash Flow
The estimating of cash flow for the future, where future year cash flows are reduced by an estimate of inflation or the interest rate (assuming that it always goes up) and therefore shows the cash flow in today's values. E.g., a million pounds received in ten years time will have a less monitory value in real spending terms than a million pounds cash flow now. E.g. a million pounds in ten years may only be able to cover the cost of a bed sit whereas now it can buy you a very large house.
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Term created / updated 2005-07-16 23:12:15
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