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The Unique, Real Internal Rate of Return: Caveat Emptor!

Published online by Cambridge University Press:  06 April 2009

Anthony Herbst
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Extract

The purpose of this paper is to show that the internal rate of return (IRR) even when unique and real may nevertheless be an incorrect measure of the return on investment, and to prove that all projects characterized by negative flows occurring only at the beginning and end will be mixed investments for which the IRR, whether unique and real or not, is not a correct measure of investment return.

Type
Research Article
Information
Journal of Financial and Quantitative Analysis , Volume 13 , Issue 2 , June 1978 , pp. 363 - 370
Copyright
Copyright © School of Business Administration, University of Washington 1978

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References

REFERENCES

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