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IRR not working Please urgent help

  1. #1
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    IRR not working Please urgent help

    Hi All,

    My IRR formula is not working. It is returning me as #NUM!

    Can someone please help??

    When I put the initial investment in the cell prior to the net cash flows then i get an IRR of 91%. How come I can't do the full IRR with the way i have it structured right now?

    THanks,
    Ahmed
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    Re: IRR not working Please urgent help

    Refer below link.
    http://www.investinganswers.com/educ...alculator-2129
    Hope this will help you.


    atul


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    Re: IRR not working Please urgent help

    IRR(values, [guess])

    The IRR function syntax has the following arguments:

    Values Required. An array or a reference to cells that contain numbers for which you want to calculate the internal rate of return.

    Values must contain at least one positive value and one negative value to calculate the internal rate of return.

    IRR uses the order of values to interpret the order of cash flows. Be sure to enter your payment and income values in the sequence you want.

    The best way: read here IRR function

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    Last edited by sandy666; 04-11-2017 at 05:15 PM.

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    Re: IRR not working Please urgent help

    Probably best to turn the costs in row 3 into negatives to get a more realistic IRR

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    Re: IRR not working Please urgent help

    Quote Originally Posted by targus92 View Post
    My IRR formula is not working. It is returning me as #NUM!
    In small part, the "guess" parameter is incorrect. Your formula is =IRR(B6:AH6,91). Presumably, you meant to write 91% or 0.91 -- a percentage.

    But the primary problem is with the Cost1 values in row 3. They should be negative, as the Cost2 values are in row 5.

    With that change alone, assuming B6 has the formula =SUM(B1:B5), the net CF1 becomes -1,438,955,879, and =IRR(B6:AH6) results in about 43.36% without a "guess".

    However, normally, we consider the initial investment to be at the end of CF0, a time frame before CF1, even it occurs on day1 of CF1.

    So I believe the more correct IRR is about 37.71%, assuming that B6 has the formula =SUM(B2:B5). Your formula can be =IRR((B1,C6:AH6)), using a special range form that only IRR and a few other functions allow.

    Alternatively, insert a column on the left, move old B1 into new B1, and =SUM(B1:B5) into new B6, and use the formula =IRR(B6:AI6).
    Last edited by joeu2004; 04-12-2017 at 02:12 AM. Reason: "with guess" -> "without guess"

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