For easy to understand:

Assume that shop owner rented his shop to a Tenent for $1000 per year.  He collecting rent every year starting from his tenent. In need of money,  the owner demanded 5 years rent total $5000 at a time.    The Tenent has not agreed to pay $5000. Instead, he agreed to pay discounting 10% interest from 2nd year to 5th year rent as follows(after discounting Interest on FV basis of NPV=FV/(1+R)^n);

1st year Rent today is : no interest : 1000

2nd year Rent today is : One year advance paying, so one year now present value 1000/(1+0.1)^1 = 909  Here discount 81

3rd year Rent  today is: Two years advace paying, so Two years now Present value 1000/(1+0.1)^2=826 Here discount 174

4th year Rent  today is: Three years advace paying, so Three years now Present value 1000/(1+0.1)^3=751 Here discount 249

5th year Rent  today is: four years advace paying, so four years Present now value 1000/(1+0.1)^4=683 Here discount 317

NPV = after deducting all years discounting interest amount cash flows:

NPV = 1000+(1000-81)+(1000-174)+(1000-249)+(1000-317)

NPV = 4,169