Internal Rate of Return: this article explains the concept of a Internal Rate of Return or IRR. Next to what it is (definition and calculation), this article also highlights importance of Capital budget and Comparison, and the Return rate. After assimilating it, you will be able to ...
Internal rate of return definition: an interest rate giving a net present value of zero when applied to the expected cash flow of a project. Its value, compared to the cost of the capital involved, is used to determine the project's viability. See exampl
Definition:Internal rate of return, commonly abbreviatedIRR, is used to measure an acceptable level ofreturnfor an investment by equating a net present value rate of zero to the investment. In other words, management uses the internal rate of return to develop a baseline or minimum rate that ...
IRR is computed using a different type of discounted cash flow analysis to determine the rate that produces the initial investment breakeven. The initial investment is the company’s cost to launch the investment project. Businesses compare the internal rate of return (IRR) for potential projects....
Discover what the internal rate of return is. Learn its importance and uses. Review its formula and learn how to calculate it through the given...
internal rate of return.A definition for the term "internal rate of return," is presented. It refers to the rate that indicates whether or not an investment is worth pursuing.EBSCO_bspBloomsbury Business Library - Business & Management Dictionary...
Learn about the internal rate of return. Understand what the IRR is, identify the problems with the IRR, and examine the importance of the NPV and...
Definition of Internal Rate of Return The internal rate of return is the interest rate that will discount an investment’s future cash amounts to be equal to cash paid at the beginning of the investment. In capital budgeting, the internal rate of return results in an investment having a net...
Internal Rate of Return (IRR) Definition The internal rate of return is adiscounting cash flow techniquethat gives a rate of return earned by a project. We can define the internal rate of return as the discounting rate, which makes a total of initial cash outlay and discounted cash inflows ...
What Is the Internal Rate of Return (IRR) Rule? The internal rate of return rule states that a project or investment may be worth pursuing if its internal rate of return (IRR) exceeds the minimum required rate of return, or hurdle rate. This rule can be useful for companies and ...