CalculateMeasure

Business

IRR Calculator

Estimate the internal rate of return for an initial investment followed by a series of periodic cash flows.

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Calculator guide

How to use the IRR Calculator

Estimate the internal rate of return for an initial investment followed by a series of periodic cash flows. Enter the requested values and select Calculate. The result and supporting values are produced locally in your browser.

Formula

IRR is the rate r where 0 = −Initial Investment + Σ(Cash Flowₜ ÷ (1 + r)ᵗ)

Worked example

For a $100,000 investment followed by $30,000, $35,000, $40,000, and $45,000 in periodic cash flows, the calculator solves for the discount rate that makes NPV approximately zero.

What to keep in mind

  • IRR assumes equally spaced cash-flow periods.
  • Cash-flow patterns with more than one sign change can produce multiple IRRs; evaluate those cases with additional analysis.
  • IRR should be considered alongside NPV, risk, timing, and the cost of capital.

Methodology

This calculator uses deterministic arithmetic and performs the calculation locally in your browser. Verify assumptions, units, and source values for your specific use case.

Review standard: Level B · Industry formula. How calculator reviews work.

Frequently asked questions

What does this calculator calculate?

Estimate the internal rate of return for an initial investment followed by a series of periodic cash flows.

How is the result calculated?

IRR is the rate r where 0 = −Initial Investment + Σ(Cash Flowₜ ÷ (1 + r)ᵗ).

Can I use the result for an important decision?

Use the result as a calculation aid and verify the inputs, assumptions, and applicable professional or regulatory requirements before relying on it for an important decision.

Does CalculateMeasure store the values I enter?

The calculator performs its arithmetic in your browser. The calculator itself does not need to send your entered values to a server to produce the result.