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When using a Discounted Cash Flow analysis, how does a longer period of free rent at the start of a lease affect the Net Present Value of the asset?



A longer period of free rent at the start of a lease decreases the Net Present Value of the asset because it reduces the total cash inflows and pushes those inflows further into the future. Net Present Value is a calculation used to determine the current value of a series of future cash flows by discounting them back to today's dollars using a required rate of return. Because ....

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Redundant Elements