Solving the dual IRR puzzle. (internal rate of return) (Asset Management): An article from: Journal of Property Management

This digital document is an article from Journal of Property Management, published by Institute of Real Estate Management on March 1, 1995. The length of the article is 1516 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.

From the supplier: Net present value (NPV) and internal rate of return (IRR) are two measures commonly used by analysts to evaluate investments. The former quantifies the profitability of investments in dollar terms, while the latter generates a percentage return that facilitates comparison of an investment's performance with that of other investments. One problem with IRR analysis is that more than one IRR solution is generated when an investment has at least three forecasted cash flows and if one IRR can be estimated. In some cases, one of the multiple IRRs that may be obtained may be discounted. However, in other cases, both IRRs may have to be considered because both could be of a magnitude that seems to agree with the expected cash flows. A method for resolving the dual IRR problem is proposed.

Citation Details
Title: Solving the dual IRR puzzle. (internal rate of return) (Asset Management)
Author: Peter F. Colwell
Publication:Journal of Property Management (Refereed)
Date: March 1, 1995
Publisher: Institute of Real Estate Management
Volume: v60 Issue: n2 Page: p60(2)

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