The Internal Rate Of Return is the rate of interest which results in a zero net cash flow of a set of discounted cash in-flows compared with the original capital outflow (investment).
Another view is that the Internal Rate of Return is the discount rate which equates the present value of a stream of incomes to an initial investment. In special cases it can be the break-even rate of interest.
If the Internal Rate of Return is less than the minimun required return from a project, with a given risk profile, then the project would not be undertaken.
The Internal Rate of Return Calculator below makes the following assumptions:-
There is a one-time capital outflow at the beginning of the project (Time 0).
All future periodic inflows are the same (constant).
All incomes are received at the end of each period.
To use the calculator:-
Input the capital investment.
Input the income inflows.
Input the length of the project.
Press "Get Internal Rate Of Return".
If you want to use this Internal Rate Of Return calculator on your web site, click HERE to get the code. Please don't forget to link back to us.
