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  Internal rate of return (IRR) Internal rate of return (IRR) refers to the interest rate at which cash income flows during a business period are converted into present value and discounted so that the sum of the cash income flows during the business period is equal to investment expenditure. The internal rate of return method is a method of considering the internal rate of return in making investment decisions. By comparing the internal rate of return with the cost of capital, if the rate of return is high, the return from the investment can be obtained. When there are several investment proposals, it is advantageous to invest in the side with high returns. Internal Return (IRR) is a method of quantifying the benefits of a project or investment opportunity. This calculation is called an internal calculation because it relies only on the cash flow of the investment being analyzed and excludes external factors such as returns, risk-free interest rates, inflation, capital costs, or f...