Determine the cash inflows and outflows for each year_npv_answer
Internal Rate of Return (IRR): This is a metric that measures the return on investment for a given project or investment over its lifetime. It is calculated by finding the rate of return that makes all future cash flows equal to zero, or in other words, make all returns equal to what was invested initially.
Modified Internal Rate of Return (MIRR): This is similar to IRR but takes into account reinvestment rates while calculating returns. MIRR assumes that any positive cash flows are reinvested at a certain rate, and any negative cash flows are reinvested at a different rate.
Payback Period: This measures how long it will take for an investment to break even and start generating profits. It can be calculated as follows: total cost/annual income = payback period in years
Discounted Payback Period: This is similar to payback period but takes into account the time value of money when measuring how quickly returns will be realized from an investment.. The discounted payback period can be calculated by discounting each period’s cumulative cash flow until it equals or surpasses the initial investment amount.
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