Net Present Value - Numpy vs Excel

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I am taking a course in Coursera and am boggled by a simple NPV function.

Question:

What is the present value of $4,000 per year annuity for 8 years at an interest rate of 6%?

Excel:

=NPV(6%, 4000, 4000, 4000, 4000, 4000, 4000, 4000, 4000)

=$24,839

Numpy_Financial:

npf.npv(0.06, [4000 for i in range(8)])

=$26,329

The excel answer is accepted as correct, and there do not seem to be any viable parameters in numpy_financial NPV function. Does anyone know how to get excel's value in Python?

excel python
1 Answers

Excel assumes that the first value is at t=1 (no initial wealth), while numpy-financial assumes the first value to be at t=0. Therefore, In numpy you start with an initial wealth of 4000 and your result is basically the excel result * 1.06.

If you want to calculate the excel result using numpy, set the initial wealth to zero:

npf.npv(0.06, [0] + [4000 for i in range(8)])
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