Internal Rate of Return
This query is : Resolved
11 February 2018
Please explain the difference between Project IRR and Equity IRR with example and relationship between the both.
13 February 2018
The project IRR takes as its inflows the full amount(s) of money that are needed in the project. The outflows are the cash generated by the project. The IRR is the internal rate of return of these cash flows. The calculation assumes that no debt is used for the project. Equity IRR assumes that you use debt for the project, so the inflows are the cash flows required minus any debt that was raised for the project. The outflows are cash flows from the project minus any interest and debt repayments. Hence, equity IRR is essentially the "leveraged" version of project IRR.
13 February 2018
https://feasibility.pro/project-irr-and-equity-irr-a-curious-connection/
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