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 ...

The internal rate of return, or IRR, allows investors to analyze the profitability of investments and companies to analyze the profitability of capital outlays. The easiest way to understand IRR is by ...

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 ...

Using a calculator, we see that the IRR of this investment would by approximately 15.1%, which is greater than the 10% required rate of return. Therefore, building the factory would be a good idea.

Companies may lease assets to optimize financial terms and manage balance sheets. Capital lease interest can be computed using the IRR function in a spreadsheet. Adjust IRR formula for payment ...