Internal Rate of Return - IRR

Internal Rate of Return - IRR

Often used in capital budgeting, it's the interest rate that makes net present value of all cash flow equal zero.

Notes:

Essentially, this is the return that a company would earn if they expanded or invested in themselves, rather than investing that money abroad.

See also: Capital Budgeting, Cash Flow, Discounted Cash Flow (DCF), Internal Rate of Return (IRR), MIRR, Net Present Value (NPV), Return On Investment Capital