Free IRR Internal Rate of Return Calculator Tool
This IRR Calculator allows the user to measure the IRR of 3 separate projects. The internal rate of return (IRR) is a capital budgeting metric used by people to decide whether they should make an investment in the project. It is an indicator of the efficiency or quality of an investment.
The IRR tool calculator (just like the one on this page) can be purchased and downloaded in Microsoft Excel for only $6. Please follow the link below to purchase this tool. Following your payment, you will be emailed the tool in Excel.
Investment: This number must always be negative. It is the amount of investment required to do the project.
Year 1 to 24: These are the inputs for the cash flows seen from the original investment.
Project 1: This project shows an investment of $12 million. Cash flows are scattered from year 1 to year 7. This project creates an IRR of 13.76%. This means that the project created on average 13.76% return per year for 7 years.
Project 2: This project has an investment of $8 million. Years 1 to 9 provide $0 in cash flow then $4 million comes in years 10. Years 11 to 19 have $0 for cash flow followed by a large lump sum of $50 million in year 20. This means that the project created on average 10.70% return per year for 20 years.
Project 3: This project has an investment of $8 million. Similar to Project 2, there are years where the investment provides $0 for cash flow. This project created on average 11.51% return per year for 24 years.