From the course: Real Estate Analysis Foundations

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Internal rate of return exercise

Internal rate of return exercise - Microsoft Excel Tutorial

From the course: Real Estate Analysis Foundations

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Internal rate of return exercise

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- All right, now we're looking at this file that is associated with the lecture. It's the same file that we use for the net present value example. But, this time we're going to use the IRR work-sheet, right here, and what you're going to see in front of you is some sample investments. So, let's take a look at the first example we're going to go through. There are eight investments. They're all 200 hundreds, initially, and all of them you're going to get a 1000 dollars back over 10 years. But, the only difference is the timing of how you're going to get the 1000 dollars. So, you see that in investment one you get in increments of 100 dollars a year. In investment two, it's similar, except you get 200 dollars in year four and year nine, and then you get nothing in five and ten, right. And you see that the pattern is different for each of these investments. Where getting to the investment eight we have 500 dollars in year four and 500 dollars in year ten. So, when we look at it like this…

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