← Project Appraisal Level 1: Project Finance Foundations

Time Value of Money for Project Decisions

Module 04 / 5 · 60 min

A Birr received in year 8 is worth much less than a Birr today, and that one idea drives loan installments, payback and NPV.

In this module you will learn to

Calculate future value and present value
Use the annuity factor to compute equal loan installments
Compute payback and simple NPV and explain what each tells the bank
Choose between projects and explain how cash flow timing shapes the loan structure

Built on

Erudite Africa training module: Project Appraisal Level 1: Project Finance Foundations (October 2026)
A commercial bank's Revised Credit Procedure Manual (August 2025), unnamed
NBE directives as listed in the lessons: FXD/01/2024 and NBE/INT/13/2026
Ethiopian laws as cited: Environmental Impact Assessment Proclamation No. 299/2002, Movable Property Security Right Proclamation No. 1147/2019, Insurance Business Proclamation No. 746/2012
Erudite Africa: Ethiopian context for banking training (39 topics, October 2026)

Examples and companies are fictional. Bank practices are shown as typical Ethiopian practice, not as any one bank's policy. Always apply your own institution's approved policy and the current NBE directives.