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-   -   Calculation of IRR and NPV Equation (https://www.askmehelpdesk.com/showthread.php?t=68139)

  • Mar 2, 2007, 06:13 PM
    tlo819
    Calculation of IRR and NPV Equation
    Please help me with the equation calculations.
    If the project is (10,000),
    year 1 10,000 how do I 1. Set this up in excel and 2. solve via equation
  • Mar 8, 2007, 08:36 AM
    12thManFan
    Quote:

    Originally Posted by tlo819
    Please help me with the equation calculations.
    If the project is (10,000),
    year 1 10,000 how do I 1. Set this up in excel and 2. solve via equation

    In excel, just type the following formula:

    =NPV(rate, cash flow 1, cash flow 2, etc... )

    In your case, cash flow 1 is -10,000 (cost to get into project)

    In equation, it's just:

    NPV = -(initial CF) + CF1/(1+r) + CF2/(1+r)^2 + etc...

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