Question
Calculate the internal rate of return using Excel's IRR function and check (using present values) that your IRR is correct. You are calculating this on
Calculate the internal rate of return using Excel's IRR function and check (using present values) that your IRR is correct. You are calculating this on January 1, 2022. Assume all flows occur on Jan. 1st. This means that 2022's numbers are not discounted, 2023 numbers are discounted 1 year, etc.
| Net | ||||
| Year | Years of | Profits | P.V. | |
| discount | ||||
| 2022 | 0 | ($1,200,000) | ||
| 2023 | 1 | $100,415 | ||
| 2024 | 2 | $121,641 | ||
| 2025 | 3 | $124,845 | ||
| 2026 | 4 | $134,455 | ||
| 2027 | 5 | $139,776 | ||
| 2028 | 6 | $121,180 | ||
| 2029 | 7 | $141,739 | ||
| 2030 | 8 | $145,679 | ||
| 2031 | 9 | $160,679 | ||
| 2032 | 10 | $159,571 | ||
| 2033 | 11 | $174,598 | ||
| 2034 | 12 | $185,717 | ||
| 2035 | 13 | $191,910 | ||
| 2036 | 14 | $199,953 | ||
| 2037 | 15 | $189,693 | ||
| 2038 | 16 | $190,268 | ||
| 2039 | 17 | $212,347 | ||
| sum | ||||
| Internal Rate of Return: |
| |||
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Finance For Executives Managing For Value Creation
Authors: Gabriel Hawawini, Claude Viallet
6th Edition
1473749247, 9781473749245
