The Development and Usage of NPV and IRR and Their Comparison

DOI

10.2991/assehr.k.211209.334How to use a DOI?

Keywords

Net present value; Internal rate of return; Capital budgeting techniques

Abstract

Net present value (NPV) and internal rate of return (IRR) are two popular capital budgeting techniques in the modern economy. Almost all finance textbooks included these two concepts. The paper presents a review of NPV and IRR from the following perspectives and aims to provide a general understanding of NPV and IRR for the audience. The development of NPV and IRR will be discussed in this paper. The disadvantages and advantages of NPV and IRR will also be presented with detailed examples. The utilization of NPV and IRR in three counties, the United States, Finland, and Japan, is discussed to offer an overview of companies’ preference of decision methods in these three counties.

Copyright

© 2021 The Authors. Published by Atlantis Press International B.V.

Open Access

This is an open access article under the CC BY-NC license.

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TY  - CONF
AU  - Yi Wang
PY  - 2021
DA  - 2021/12/15
TI  - The Development and Usage of NPV and IRR and Their Comparison
BT  - Proceedings of the 2021 3rd International Conference on Economic Management and Cultural Industry (ICEMCI 2021)
PB  - Atlantis Press
SP  - 2044
EP  - 2048
SN  - 2352-5428
UR  - https://doi.org/10.2991/assehr.k.211209.334
DO  - 10.2991/assehr.k.211209.334
ID  - Wang2021
ER  -