From the course: Pre-investing: Before Investing in Real Estate

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IRR demonstration

IRR demonstration - Microsoft Excel Tutorial

From the course: Pre-investing: Before Investing in Real Estate

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IRR demonstration

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- Alright, now we're lookin' at this file that is associated with the lecture. It's the same file that we used for the net present value example. But this time we're going to use the IRR worksheet right here and what you're going to see in front of you is some sample investments. So let's take a look at the first example we're going to go through. There are eight investments, they're all $200 initially and all of them you're going to get $1,000 back over 10 years. But the only difference is the timing of how you're going to get the $1,000. So you see that in the investment one you get it in increments of $100 a year. In investment two, it's similar except you get $200 in year four and year nine and then you get nothing in five and 10. And you see that the pattern is different for each of these investments. Where getting to the investment eight, we have $500 in year four and $500 in year 10. So when we look at it like this and only looking at the pure investment dollars, they look…

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