Definition: Internal rate of return, commonly abbreviated IRR, is used to measure an acceptable level of return for 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 ...
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
The internal rate of return is used to evaluate projects or investments. The IRR estimates a project’s breakeven discount rate (or rate of return) which indicates the project’s potential for profitability. Based on IRR, a company will decide to either accept or reject a project. If the IR...
The XIRR function in Excel is commonly used to calculate a return on a set of irregularly spaced cash flows. Instead of solving for an effective periodic rate like the IRR, the XIRR calculates aneffective annual ratethat sets the net present value equal to zero. IRR Meaning Memorizing IRR fo...
The rate that will discount all cash flows to a net present value of zero. Related Q&A What is the internal rate of return? How do I calculate IRR and NPV? What are some of the methods for evaluating capital expenditures? What is net present value? What is hurdle rate? Why does the ...
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...
The meaning of internal rates of return. J. Finance 36 (5), 1011-1021. (December).Dorfman, R. (1981). The meaning of internal rates of return. J. of Finance, 5(36), 1011-1021.Dorfman, Robert, "The Meaning of Internal Rate of Return", Journal of Finance 36 (December 1981), ...
17.Application of Revised Internal rate of return in economic evaluation;修正的内部收益率在经济评价中的应用 18.Study on Existent Meaning of Inside Rate and its Appraising Methods;论内部收益率及其评价方法存在的价值 相关短句/例句 IRR内部收益率 1.Discussion on Relationship between IRR and A /P;对内...
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 equal to zero. In other words, it is ...
The pooled internal rate of return can be expressed as a formula: IRR=NPV=∑t=1TCt(1+r)t−C0=0where:IRR=internal rate of returnNPV=net present valueCt=the pooled cash flows expected at timetr=the risk-free rate of return\begin{aligned}&IRR\ =\ NPV\ =\ \sum^T_{t=1}\frac{...