Net present value and equivalent annual cost are two discounted cash flow criteria for comparing investment proposals. Why have accountants taken to net present value? Why do engineers readily use equivalent annual cost? This paper investigates the historical development of these principles to provide an explanation of why this is so.
Jones, Thomas W. and Smith, J. David
"Historical perspective on net present value and equivalent annual cost,"
Accounting Historians Journal: Vol. 9
, Article 6.
Available at: https://egrove.olemiss.edu/aah_journal/vol9/iss1/6