Texas Instruments BA II PLUS - Manual (Page 49)

Cash Flow Worksheet 45
• Internal rate of return ( IRR ) is the interest rate at which the net
present value of the cash flows is equal to 0.
Computing NPV
1. Press ( to display the current discount rate ( I ).
2. Key in a value and press !.
3. Press # to display the current net present value ( NPV ).
4. To compute the net present value for the series of cash flows
entered, press
%.
Computing IRR
1. Press ). The IRR variable and current value are displayed (based on
the current cash-flow values).
2. To compute the internal rate of return, press %. The calculator
displays the IRR value.
When solving for IRR , the calculator performs a series of complex,
iterative calculations that can take seconds or even minutes to complete.
The number of possible
IRR solutions depends on the number of sign
changes in your cash-flow sequence.
• When a sequence of cash flows has no sign changes, no IRR solution
exists. The calculator displays Error 5 .
• When a sequence of cash flows has only one sign change, only one
IRR solution exists, which the calculator displays.
• When a sequence of cash flows has two or more sign changes:
– At least one solution exists.
– As many solutions can exist as there are sign changes.