[jsridhar]

This is unclear to me too. In some cases, while NPV Breakeven point is calculated, npv of all cash inflows, outflows are taken to find the contribution and equated to all fixed costs except depreciation. The initial investment is ignored.

In another case, the equation used is

npv of (contribution – fixed costs) = initial investment

which is right and if both are correct, how do we choose which to use under what conditions.

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