IRR measures the rate needed to break even on an investment. Calculate IRR by setting NPV to zero and solving for the discount rate. Use Excel's IRR function by inputting initial cost and cash inflow.

Calculate the present value of each year's cash flow by dividing by (1 + discount rate)^number of years. Sum all present values to find the total value of projected cash flows, which in this example ...

The internal rate of return, or IRR, allows investors to analyze the profitability of investments and companies to analyze the profitability of capital outlays. The easiest way to understand IRR is by ...

A discounted cash flow, or DCF, analysis measures the value of a business or project, such as a new factory for your small business. This value equals the sum of all of the project's future annual ...

Discounting a future cash flow expresses future returns in today's dollars. This allows a fair comparison between initial business expenses and your expected or realized returns. As an example, you ...