Manufacturing Project Portfolio & Capex worked example

Project NPV at 56% discount adjustment: a worked example

Here is what the math looks like when conditions slip. We hold every other input steady and drop discount adjustment to 56%, then walk the calculation through step by step. Estimate the net present value of a manufacturing capex project from discounted annual cash flows and upfront outlay.

The inputs for this scenario

  • Cash flow periods: 7 years (held at the documented default)
  • Annual net cash flow: 95,000 $/year (held at the documented default)
  • Discount adjustment: 56 % (the input this scenario stresses; the baseline uses 78)
  • Initial capital outlay: -350,000 $ (held at the documented default)

Working through the calculation

  • The calculation starts from the formula this tool documents: Project NPV = cash flow periods x annual net cash flow x discount adjustment + initial outlay.
  • Total project npv cost works out to 372,400 $ at these inputs, and this is the headline figure for the scenario.
  • Project npv cost per unit works out to 53,200 $ / piece at these inputs.
  • Variable project npv cost works out to 372,400 $ at these inputs.
  • Fixed project npv adder works out to 0 $ at these inputs.

How this compares with the baseline

  • Against the tool's baseline example, where discount adjustment sits at 78% and the headline result is 518,700 $, this scenario comes in 28.21% below the baseline at 372,400 $.
  • The practical read: the gap between this scenario and the baseline is entirely attributable to discount adjustment, so recovering it is worth quantifying in dollars before considering equipment or staffing changes. This preset uses a simplified discount adjustment rather than full period-by-period discounting, so for long horizons or uneven cash flows a detailed DCF model will be more precise.

Results at a glance

  • Total project npv cost: 372,400 $ (headline result)
  • Project npv cost per unit: 53,200 $ / piece
  • Variable project npv cost: 372,400 $
  • Fixed project npv adder: 0 $

Run it with your numbers

  • To rerun this with your own numbers, open the live Project NPV calculator, set discount adjustment to your actual value, and adjust the remaining inputs to match your operation.

Last reviewed 2026-05-12.