GlenCalc

IRR calculator

Enter cash flows in order, one per period, starting with the investment as a negative number. You get the IRR, the rate at which the flows break even, and the NPV at your discount rate.

Start with the investment (negative), then each period’s cash flow.

Your answer

IRR16.341 % per period
NPV at 8%$1,776.66
Undiscounted net$4,000.00

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How we worked it out

Updated as you change the numbers.

  1. NPV(r) = Σ CFₜ ÷ (1 + r)ᵗ for t = 0 to 3.
  2. IRR is the rate r where NPV(r) = 0, found numerically.

Method and assumptions

NPV discounts each cash flow back to period 0 and adds them up. IRR is the discount rate at which NPV is exactly zero. If the cash flows change sign more than once, there can be more than one IRR, and NPV is the more reliable measure.

Questions

What is the IRR of −10,000 then 3,000, 4,200 and 6,800?

About 16.3% per period.

Sources

Method and figures checked on . Every worked answer on this page is covered by an automated test. Found a mistake? Tell us.

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