IRR CALC ON DAILY BASIS

Date
OUTFLOW
RATE OF INTEREST
INFLOW
PERIOD - MTHS

-100,000
17.91%
9,168
12

1/1/2008
2/1/2008
3/1/2008
4/1/2008
5/1/2008
6/1/2008
7/1/2008
8/1/2008
9/1/2008
10/1/2008
11/1/2008
12/1/2008
1/1/2009

Period
0
31
60
91
121
152
182
213
244
274
305
335
366

Outlflow / Discount
Inflow
Factor
-100000
9,168
9,168
9,168
9,168
9,168
9,168
9,168
9,168
9,168
9,168
9,168
9,168

1.0000
0.9849
0.9711
0.9565
0.9425
0.9283
0.9148
0.9010
0.8875
0.8745
0.8614
0.8488
0.8361

Discounted
Outflow /
(Inflow)
-100,000
9,030
8,903
8,769
8,641
8,511
8,387
8,261
8,136
8,018
7,897
7,782
7,665
-0.00

IRR IS THE INTEREST RATE AT WHICH THE SUM OF DISCOUNTED OUTFLOW / INFLOW IS ZERO.

IRR CALC ON MONTHLY BASIS

Date
OUTFLOW
-100,000
RATE OF INTEREST 18.00%
INFLOW
9,168
PERIOD - MTHS
12

1/1/2008
2/1/2008
3/1/2008
4/1/2008
5/1/2008
6/1/2008
7/1/2008
8/1/2008
9/1/2008
10/1/2008
11/1/2008
12/1/2008
1/1/2009

Period

Outlflow / Discount
Inflow
Factor

0 -100,000
1
9,168
2
9,168
3
9,168
4
9,168
5
9,168
6
9,168
7
9,168
8
9,168
9
9,168
10
9,168
11
9,168
12
9,168

1.0000
0.9852
0.9707
0.9563
0.9422
0.9283
0.9145
0.9010
0.8877
0.8746
0.8617
0.8489
0.8364

Discounted
Outflow /
(Inflow)
-100,000
9,033
8,899
8,768
8,638
8,510
8,385
8,261
8,139
8,018
7,900
7,783
7,668
0.01

A
1

Data
-70,000

B
Descriptio
n
Initial
cost of a
business

2
12,000

Net
income
for the
first year

15,000

Net
income
for the
second
year
Net
income
for the
third
year
Net
income
for the
fourth
year
Net
income
for the
fifth
year

4
18,000

5
21,000

6
26,000

Descriptio
Formula n (Result)
#NUM!
Investm
ent's
internal
rate of
return
after
four
years (2%)

#NUM!

#NUM!

Internal
rate of
return
after
five
years
(9%)
To
calculate
the
internal
rate of
return
after
two
years,
you
need to
include a
guess (44%)

-70,000
12,000
15,000
18,000
21,000
26,000
-2%
9%
-44%

Initial cost of a business

Net income for the first year
Net income for the second year
Net income for the third year
Net income for the fourth year
Net income for the fifth year
Investment's internal rate of return after four years
(-2%)
Internal rate of return after five years (9%)
To calculate the internal rate of return after two
years, you need to include a guess (-44%)