The Internal Rate of Return ( IRR )

*Note : I am going to add my Corporate Strategy Assigment when i was at the university about Financial Investment Methods. Enjoy it :)

PART -13

1.     THE INTERNAL RATE OF RETURN (IRR)

Internal rate of return is a kind of method, which considers the time value of money to find the yield of the project.

Internal rate of return is the discount rate that the useful life of the investment cash flows will be provided to equal throughout investment expenditures.

Internal rate of return method consider the expected future cash flows while present cash flow is used, income tax effect that changes from year to year, the accounts can participate in the salvage value at the end of the useful life of the project. The amount of direct investment is calculated with ultimately in the figure by comparing the internal rate of return.