Calculating the internal rate of return, or IRR, of an investment is a powerful tool for businesses. When a manager is faced with a capital intensive decision, IRR can quickly compare the financial ...

Daniel Jassy, CFA, is an Investopedia Academy instructor and the founder of SPYderCRusher Research. He contributes to Excel and Algorithmic Trading. David Kindness is a Certified Public Accountant ...

IRR measures the rate needed to break even on an investment. Calculate IRR by setting NPV to zero and solving for the discount rate. Use Excel's IRR function by inputting initial cost and cash inflow.

Every day, business managers make capital budget decisions -- choices about whether to invest in projects such as building a factory, upgrading machinery or investing in research and development. But ...

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Q. I have prepared projections for a proposed project, and I want to calculate the internal rate of return. Instead of using Excel’s IRR function, should I use simple math formulas so others can ...

Calculating the IRR for a project with an initial outlay and single cash flow is very easy to do. It's also very practical for measuring the returns on investments in collectibles, commodities, ...

IRR calculates a project's average expected return by setting NPV to zero. Excel's XIRR function can compute project IRRs to help select profitable options. IRR overlooks cash flow accuracy and other ...

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