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Calculators / Finance / Internal rate of return
Internal rate of return calculator
Estimate IRR for one initial investment and five annual cash flows.
On this page
Estimated IRR12.64%
NPV at estimated IRR7.28e-12
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How to calculate
Estimate IRR for one initial investment and five annual cash flows.
Find the annual rate that makes the discounted value of all cash flows equal the initial investment.
Worked example
Initial investment: 10000; Cash flow year 1: 2500; Cash flow year 2: 3000; Cash flow year 3: 3500; Cash flow year 4: 3000; Cash flow year 5: 2000.
Estimated IRR: 12.64 %; NPV at estimated IRR: 7.28e-12 .
Assumptions and limits
IRR can be absent or have multiple solutions when cash-flow signs change more than once. Compare with NPV and the required return.
Results are rounded for display; calculations use unrounded values. Read our calculation methodology.
Understanding the result
Estimate IRR for one initial investment and five annual cash flows. The displayed figures use the inputs and formula shown on this page.
When this tool is useful
Use the internal rate of return to compare a scenario, check an estimate, or verify a manual calculation.
Understanding your inputs
| Input | What to enter |
|---|---|
| Initial investment | Enter a number of at least 0.000001 and no more than 1000000000000. |
| Cash flow year 1 | Enter a number of at least -1000000000000 and no more than 1000000000000. |
| Cash flow year 2 | Enter a number of at least -1000000000000 and no more than 1000000000000. |
| Cash flow year 3 | Enter a number of at least -1000000000000 and no more than 1000000000000. |
| Cash flow year 4 | Enter a number of at least -1000000000000 and no more than 1000000000000. |
| Cash flow year 5 | Enter a number of at least -1000000000000 and no more than 1000000000000. |
Frequently asked questions
What should I check before using the internal rate of return result?
IRR can be absent or have multiple solutions when cash-flow signs change more than once. Compare with NPV and the required return.
Is this internal rate of return result exact?
It is exact for the stated mathematical model and entered values. Real-world results can differ when rates, timing, fees, definitions or measurement conditions differ.