Mirr Calculator

This MIRR Calculator enables users to compute the Modified Internal Rate of Return by evaluating a series of cash flows with specified finance and reinvestment rates over a number of periods, providing insights into investment potential with formatted results.

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How to Use the MIRR (Modified Internal Rate of Return) Calculator

The MIRR Calculator is a tool designed to help you calculate the Modified Internal Rate of Return for your investments. Follow these step-by-step instructions to effectively use the calculator.

Step 1: Enter the Initial Investment

Initial Investment ($): Start by entering the initial investment amount. This is the initial expenditure or cash outflow related to your project or investment. Ensure that this value is entered as a non-negative number.

Step 2: Input Cash Flows

Cash Flows ($): Input the cash flows, which are the periodic returns expected or received from the investment. This field requires input for each period in the sequence you have and is essential for the calculations.

Step 3: Specify the Finance Rate

Finance Rate (%): Enter the finance rate, which indicates the cost of financing the negative cash flows. The rate should be entered as a percentage (e.g., 10 for 10%) and must lie between 0 and 100 percent.

Step 4: Provide the Reinvestment Rate

Reinvestment Rate (%): Provide the reinvestment rate, which is the rate of return received on reinvested positive cash flows. This also should be input as a percentage (e.g., 8 for 8%) between 0 and 100 percent.

Step 5: Determine the Number of Periods

Number of Periods: Enter the number of periods for your investment, which indicates the duration of the investment or project. This should be a positive whole number (at least 1).

Step 6: Review the Results

After entering all the necessary data, the calculator will provide you with the following results:

  • MIRR: The Modified Internal Rate of Return, expressed as a percentage, showing the annual return rate on the investment.
  • Present Value of Negative Flows: Displays the present value of negative cash flows, calculated using the finance rate and displayed in USD with two decimal places.
  • Terminal Value of Positive Flows: Displays the terminal value of positive cash flows, calculated using the reinvestment rate and shown in USD with two decimal places.
  • Net Present Value: The net present value is calculated as the terminal value minus the present value and shown in USD with two decimal places.

With this guide, you can efficiently use the MIRR Calculator to assess potential investment opportunities and make informed financial decisions.