Question

Assume a project with and outlay of 200, and inflows of 100 for three years, starting one year from today. Find IRR.

Answer 1

Step-by-step explanation:

The internal rate of return (IRR) is the discount rate that makes the net present value (NPV) of the cash flows from the project equal to zero. To find the IRR, you can use a financial calculator or spreadsheet software that has a built-in IRR function.

In this case, the initial outlay is -200 and the cash flows for the next three years are 100, 100, and 100.

The IRR can be calculated using excel formula =IRR(values,guess) where values is the range of cells containing the cash flows and guess is the estimated IRR.

Alternatively, you can use online IRR calculators as