The Analysis of NPV and IRR and Its Alternative Methods
DOI:
https://doi.org/10.54691/bcpbm.v38i.4043Keywords:
net present value, internal rate of return, preferred methods, investment rule.Abstract
Based on the analysis of the net present value method and the internal rate of return method, this paper lists the pros and cons of these two different investment rules and gives some alternative approaches. With improvement and optimization, these two investment rules can be more efficient convenient, and widely used than before. This essay further enriched and developed the internal rate of return and net present value rules by analyzing the advantages and disadvantages of the measurement methods in detail. In addition, it provides implications for investors to better evaluate the corporate or project value.
Downloads
References
Grey B. (2019) The way to select the appropriate discount rate.
http://www.creentrepreneur.com/how-to-select-the-appropriate-discount-rate/
Anil A, John C. Fellingham, and Jonathan C. Glover. (1998) Capital Budgeting: Some Exceptions to the Net Present Value Rule. Issues in Accounting Education, 13: 499-508
Jerry Donald M. (2010) Method for Analyzing an Investment Using Net Present Value and Internal Rate of Return.The United States Patent Application Publication, Stockbridge
Stewart C. Myers, Richard A. Brealey, Franklin Allen. (1980) Principles of Corporate Finance, McGraw-Hill Company, New York
Xiuying G, Xiantao L, Yanyun Z. (2003) The Internal Rate of Return Method for Investment Project Evaluation.Chemical Techno-Economics, 21: 40-44
Duncan A. M, (2017) Internal Rate of Return: Good and Bad Features, and a New Way of Interpreting the Historic Measure.Computers and Chemical Engineering http://dx.doi.org/10.1016/j.compchemeng .2017.06.005
Dr. Balaram Bora, (2015) Comparison Between Net Present Value and Internal Rate of Return. International Journal of Research in Finance and Marketing, 5: 61-71
Dalian Zhang, Yue Huang, (2004) Application of Net Present Value Method and Modified Embedded Rate of Return Method in Investment.Journal of Xi’an Institute of Technology, 24:302-306
Bingjun Liu, (2003) Limitations and solutions of the traditional NPV method, Commercial Research, 276: 16-17
Hongmei Zhao, Chanchan Xu, (2010) Application of IRR Method in Investment Project Decision Making, In: Scientific Forum, Xi’an, pp.172
Downloads
Published
Issue
Section
How to Cite
