1 / 21

Internal Rate of Return (IRR) and Net Present Value (NPV)

Internal Rate of Return (IRR) and Net Present Value (NPV). IRR and NPV. IRR and NPV HP 10B Keystrokes. Clears registers One payment per year PV = -$ 28,371 FV = $ 50,000 FV in 5 years Solve for IRR. IRR and NPV. IRR and NPV HP 10B Keystrokes. Clears registers One payment per year

mariam-carver
Download Presentation

Internal Rate of Return (IRR) and Net Present Value (NPV)

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Internal Rate of Return (IRR) and Net Present Value (NPV)

  2. IRR and NPV

  3. IRR and NPVHP 10B Keystrokes Clears registers One payment per year PV = -$ 28,371 FV = $ 50,000 FV in 5 years Solve for IRR

  4. IRR and NPV

  5. IRR and NPVHP 10B Keystrokes Clears registers One payment per year $50,000 future value Discount rate = 15% FV in 5 years Compute present value Subtract $28,371

  6. IRR and NPV

  7. IRR and NPVHP 10B Keystrokes Clears registers Monthly compounding PV = - $28,371 Monthly pmt = $445.66 96 months Compute IRR

  8. IRR and NPV

  9. IRR and NPVHP 10B Keystrokes Clears registers Monthly payments Monthly pmt = $445.66 Annual discount rate = 10% 96 monthly payments Compute PV Subtract $28,371

  10. IRR and NPV

  11. IRR and NPVHP 10B Keystrokes Clears registers Monthly payments PV = -$96,000 Monthly pmt = $1,028.61 FV = $97,662.97 60 months Compute yield (IRR)

  12. IRR and NPV

  13. IRR and NPVHP 10B Keystrokes Clears registers Monthly payments Monthly pmt = $1,028.61 FV = $97,662.97 60 months of payments Discount rate = 13.1047% Compute PV Subtract $96,000

  14. IRR and NPV

  15. IRR and NPVHP 10B Keystokes Clears registers One payment per year Initial CF = - $100,000 1st CF = $ 20,000 2nd CF = $ 35,000 3rd CF = $ 75,000 Compute yield (IRR)

  16. IRR and NPV

  17. IRR and NPVHP 10B Keystrokes Clear registers One payment per year Initial CF = - $ 10,000 1st CF = - $ 8,000 2nd CF = - $ 5,000 3rd CF = $ 15,000 4th CF = $ 25,000 Discount rate = 10% Compute net present value

  18. IRR and NPV

  19. IRR and NPVHP 10B Keystrokes Clears registers One payment per year Initial CF = - $ 92,725.60 1st grouped CF = $ 10,000 Occurs three times 2nd grouped CF = $ 15,000 Occurs twice 3rd CF = $ 100,000 (once) Compute the yield (IRR)

  20. IRR and NPV

  21. IRR and NPVHP 10B Keystrokes Clear registers Monthly payments Initial CF = - $98,000 1st grouped CF = $791.38 Occurs 12 times 2nd grouped CF = $850.73 Occurs 12 times 3rd grouped CF = $914.54 Occurs 11 times 4th CF = $107,491.18 (once) Discount rate = 13% Compute net present value

More Related