IRR Calculator
Enter **cash flows** (negative for initial investment, positive for returns) separated by commas.
Internal Rate of Return (IRR): 0.00%
IRR Calculator - A Complete Guide
The **Internal Rate of Return (IRR)** helps evaluate the profitability of an investment by determining the **annualized rate of return** on a series of cash flows.
How is IRR Calculated?
The IRR is the discount rate that makes the **Net Present Value (NPV) of cash flows equal to zero**:
NPV = ∑ (Ct / (1 + IRR)^t) = 0
Where:
- **Ct** = Cash inflow or outflow at time period **t**
- **IRR** = Internal Rate of Return
- **t** = Time period
Example Calculations
Example 1: An investment of **$1,000** with returns of **$300, $400, $500, and $600** over 4 years.
IRR = **18.49%**
Example 2: An investment of **$5,000** with returns of **$2,000, $2,500, $3,000** over 3 years.
IRR = **22.63%**
Use this **IRR Calculator** to analyze your investments and make informed financial decisions.
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