Solve for the internal rate of return that makes a stream of cash flows net to zero.
IRR
?
The annualized return rate that makes the present value of cash inflows and outflows equal zero.
15.2%
4 iterations
Method
Newton-Raphson
Cash flow schedule
| Period | Cash flow |
|---|---|
| Year 0 | $-1,000 |
| Year 1 | $300 |
| Year 2 | $300 |
| Year 3 | $300 |
| Year 4 | $300 |
| Year 5 | $300 |
Data view
This curve plots discount rate on the horizontal axis and NPV on the vertical axis. The IRR is the point where the curve crosses zero: lower rates leave positive value, while higher rates can push the same cash flows below zero.