Learn how to calculate the internal rate of return (IRR) in Excel and how it’s used to determine whether a capital investment can be profitable.

The Difference Between Yield and IRR Calculations in Excel. When it comes to calculating interest rates for investments and bonds, the Yield and IRR formulas in Excel can quickly become your friends.

Earlier, we had seen how the RATE function can be used to calculate the return on investments, whether lump-sum or periodic. This can come in handy in the calculation of SIP returns, too.

Excel offers three functions for calculating the internal rate of return, and I recommend you use all three.

IRR is a discount rate, for which NPV is equal to 0. However, since IRR function is not linear, it is possible to calculate more IRRs for one stream of CFs, so called unconventional cash flows.

Excel Financial functions are used to assist Financial Analysts and Investment Brokers to make calculations and create graphs. Here are the useful ones!