## Discounting (Present Value) Techniques - Introduction
Discounting techniques consider the time value of money by discounting future cash flows to their present value. They are also called Present Value techniques.
The five discounting techniques are:
- Net Present Value (NPV)
- Internal Rate of Return (IRR)
- Profitability Index (PI)
- Discounted Payback Period
- Modified Internal Rate of Return (MIRR)
Unlike traditional methods (payback, ARR), these recognise that a rupee today is worth more than a rupee tomorrow.