IRR
The IRR function returns the internal rate of return for a series of positive and negative cash flows. Node references are also accepted as arguments.
Syntax
IRR (values,Guess?) - > Number
Arguments
values
Number, node reference
The node that contains the cash outflow and inflows for which you want to calculate the IRR. This is a required argument.
Guess?
Number
A value that you guess is closest to the actual IRR value. This is an optional argument.
Remarks
The argument should contain at least one positive and one negative value.
Example
Consider the below example of a project with an initial investment of $10,000 and cash inflows of $4,000 for the subsequent four years. The objective is to evaluate the project by calculating IRR.
Initial Investment
-10000
-
-
-
-
Cash Inflows
-
4000
4000
4000
4000
To achieve this, the following formula should be written in the [IRR] node:
IRR([Initial Investment],[Cash Inflows].ALL_PERIODS)
We are including .ALL_PERIODS in the formula so that it takes the value of the entire year's cash inflow rather a single period.
Result
IRR
21.86%
Last updated