Question

Year	Cash Flow
0		-3,024
1		17,172
2		-36,420
3		34,200
4		-12,000

consider the above cash flow. the IRRs, from smaller to largest are

a)_______ %

b) ________ %

c) _______ %

( Hint: search between 20% and 70%)

answer rounded 2 decimal places

Answer 1

Using excel formula to calculate Multiple IRRs

	A	B	C
Year	Cash Flow	Guess Values	IRR	Excel Formula
0	-3,024	20%	25.00%	(IRR(A1:A5,20%
1	17,172	21%	25.00%	(IRR(A1:A5,21%)
2	-36,420	22%	25.00%	(IRR(A1:A5,22%)	and so on
3	34,200	23%	25.00%
4	-12,000	24%	25.00%
		25%	25.00%
		26%	25.00%
		27%	25.00%
		28%	25.00%
		29%	33.33%
		30%	33.33%
		31%	33.33%
		32%	33.33%
		33%	33.33%
		34%	33.33%
		35%	33.33%
		36%	33.33%
		37%	33.33%
		38%	25.00%
		39%	42.86%
		40%	42.86%
		41%	42.86%
		42%	42.86%
		43%	42.86%
		44%	42.86%
		45%	42.86%
		46%	42.86%
		47%	42.86%
		48%	42.86%
		49%	42.86%
		50%	42.86%
		51%	42.86%
		52%	42.86%
		53%	42.86%
		54%	42.86%
		55%	42.86%
		56%	33.33%
		57%	42.86%
		58%	33.33%
		59%	66.67%
		60%	66.67%
		61%	66.67%
		62%	66.67%
		63%	66.67%
		64%	66.67%
		65%	66.67%
		66%	66.67%
		67%	66.67%
		68%	66.67%
		69%	66.67%
		70%	66.67%

IRRs of multiple cash flows is 25%,33.33%,42.86% and 66.67%

Please Discuss in case of Doubt

Best of Luck. God Bless
Please Rate Well