Precision Financial Calculator

Example V-1 Verify IRR

IRR, the Internal Rate of Return, is defined as the discount rate that generates zero net present value. Verify this by giving your own example.


Create yearly cash flows: -1000,300,300,300,300. This gives you IRR=7.71%. Now, type in 7.71 in the Discount Rate box. The NPV and FV at this discount rate become zero.


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