## Shortcomings of the IRR

Shortcomings of the IRR Now here is another example. Project B and Project B again you get $100 million today, you expect to put down $300 million a year from now, and…

## NPV vs IRR

NPV vs IRR Every business comes across a number of decisions to be made on a daily basis regarding making investments in different projects. However, making these investments requires a…

## Multiple IRR

Multiple IRR In real life, you would find many projects that have more cash outflows in addition to initial cash outflow. In such cases there may be more than one discount…

## IRR Decision Rule | Capital Budgeting Techniques

IRR Decision Rule IRR is one among a number of capital budgeting techniques which is most commonly used by the investors for evaluating their investment decisions. What is IRR? IRR…

## How to Calculate Discounted Payback Period | Capital Budgeting Techniques

How to Calculate Discounted Payback Period For calculating discounted payback period (DPP), we will calculate the present value (PV) of each cash flow (CF) starting from the first year as…

## How to Calculate Payback Period | Capital Budgeting Techniques

How to Calculate Payback Period-Capital Budgeting Techniques Payback period is calculated by capital invested in the project by the net annual cash flow. Average of net annual cash flows may…

## Internal Rate Of Return And Mutually Exclusive Projects

Internal Rate Of Return And Mutually Exclusive Projects……. What's the Concern? While considering the mutually exclusive projects, IRR technique can be misleading. Investment projects are said to be mutually exclusive…

## Net Present Value (NPV) Formula and Example

How to Calculate Net Present Value using Excel: The calculation of net present value is useful when a business has to identify a viable investment opportunity. There are many ways to…