Exercises / Finance and business maths · 11 of 14
The return on a project: IRR
IRR(cash flows) is the discount rate at which the NPV is zero: the yearly return the project earns. It needs at least one negative and one positive cash flow, starting with year 0.
Your taskIn B11, work out the IRR of the cash flows in B4:B9, from the year-0 investment to year 5.
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| Row | A | B |
|---|---|---|
| 1 | ||
| 2 | ||
| 3 | Year | Cash flow |
| 4 | 0 | -$50,000.00 |
| 5 | 1 | $12,000.00 |
| 6 | 2 | $15,000.00 |
| 7 | 3 | $16,000.00 |
| 8 | 4 | $14,000.00 |
| 9 | 5 | $10,000.00 |
| 10 | ||
| 11 | IRR |