How will you ever know whether a project is worth doing? Figure out its value to you at the present -- before you get going. This is called the Net Present Value of an investment, where you determine all the benefits and costs of the project for a given horizon, say three years. Then you discount back to the present at a ``hurdle rate.'' That rate is the return that the company thinks it can get from alternate uses of its cash.

So if you discount back at the hurdle rate and still get a positive number, you know this is a better use of the cash. You can even rank alternate projects by their Net Present Values.

The example in this calculator compares the benefits associated with the purchase of a Sun Microsystems Sun Fire V1280 Server with eight Ultrasparc III processors and 16 GB of memory for $99,995 against investing the money in securities offering a 6% annual yield. Benefits, in this case, might include cost savings of $35,000 in year one or increased revenue, from a greater ability to process new business, of $50,000 in year three.

To see the details behind this calculator and fill in your own estimates, click on the "Get the Tool" icon above and download the interactive worksheet.