How to Excel at calculating the Internal Rate of Return A blonde wanting to earn some money decided to hire herself out as a handyman-type and started canvassing a wealthy neighbourhood.

The Internal Rate of Return formula references a technique for evaluating capital investments. This function enables you to calculate interest earned on an investment by converting all cash flows ...

The internal rate of return, sometimes called the "yield criterion" or the "dollar-weighted rate of return," is a measure widely used to gauge whether an investment is worth pursuing, or in ...

Now I just hit enter, and Excel calculates that my internal rate of return on my Microsoft stock was 0.2373. This result is actually a percentage, an IRR of 23.73%.

Projected Return on Invested Money The internal rate of return, or IRR, is the interest rate that provides a net present value, or NPV, of future cash flows equal to the initial investment amount.

The next step is to use the =IRR () formula in Excel to calculate our internal rate of return. That formula returns 16.2%, which is our internal rate of return for this investment.

Internal rate of return (IRR) is one of several well-known formulas used to evaluate prospective investments, especially ones that generate cash flows, like in real estate.