Finance
Discounted cash flow (DCF) is a financial valuation method used to estimate the value of an investment based on its expected future cash flows, which are adjusted for the time value of money. This method recognizes that a dollar today is worth more than a dollar in the future due to its potential earning capacity. By discounting future cash flows back to their present value, investors can make informed decisions about capital investments and projects, weighing potential profitability against risk and costs.
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