INTERNAL RATE OF RETURN

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Hi

Could anyone please help with the meaning of IRR? I can not seem to understand it no matter how many times it is explained to me!! Please could someone explain wot this means as I have seen it in a few past papers where it asked u to expalin the meaning of IRR and I havent a clue. Can someeone explain in simple terms!!

Thanks
Cat :?

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Re:INTERNAL RATE OF RETURN

http://www.bized.ac.uk/timeweb/reference/using_experiments.htm

not sure if that will help

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Re:INTERNAL RATE OF RETURN

http://www.accountingtechnician.co.uk/atonline/study_zone/display/store690/item8346/


This is an article from the AAT magazne that helped me

Lyn

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Re:INTERNAL RATE OF RETURN

http://www.aat.org.uk/forums/posts/list/11450.page

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Re:INTERNAL RATE OF RETURN

As I understand it the IRR is the rate of interest at which the NPV is zero, in other words its like breakeven point, it is where when the cashflows discounted at that interest rate ie 12% result in the net present value being zero, it is where discounted cash flows equal the initial investment

I think this is right!!

System

Re:INTERNAL RATE OF RETURN

Yes