IRR Calculator
Calculate the Internal Rate of Return (IRR) to find the annualized percent growth rate of an investment based on periodic cash flows.
Enter the expected cash received each year, separated by commas.
The Comprehensive Guide to IRR Calculator
What is a IRR Calculator?
The IRR Calculator (Internal Rate of Return) identifies the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero. In plain English, it indicates the expected growth rate that an investment generates.
The Mathematical Formula
This tool utilize standardized mathematical formulas and logic to calculate precise Irr results.
Calculation Example
If you invest $100,000 today and receive $50,000 in year one and $60,000 in year two:
- Year 0: -$100,000
- Year 1: +$50,000
- Year 2: +$60,000
- IRR: Approximately 6.4%
Strategic Use Cases
- Project Feasibility: Businesses use IRR to decide between capital projects. If a new factory has an IRR of 12% but the cost of borrowing capital is 15%, the project is mathematically rejected.
Frequently Asked Questions
How accurate is this calculator?
Our calculator uses industry-standard formulas to provide the most accurate results possible. However, it should be used for informational purposes only and not as a basis for formal calculations or legal advice.
Is this tool free to use?
Yes, all our calculators are 100% free to use. We do not require any registration, personal information, or subscriptions.
Can I use this on my mobile device?
Absolutely! Our website is fully responsive and optimized for all screen sizes, including smartphones and tablets, so you can calculate on the go.
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