Excel 2000 in a Nutshell

Name

MIRR

Synopsis

MIRR provides the ability to determine the modified internal rate of return for a series of cash flows that occur on a regular schedule. This is accomplished by using not only the income amounts for the investments, but also the rate of return received when you reinvest the income. To use this function, all the income must be reinvested at the same rate.

Note

If you don’t intend to reinvest the returns, or they are being invested at different rates, you will need to use the IRR function to calculate the rate of return on the initial investment.

To Calculate

=MIRR(Values, Finance_Rate, Reinvest_Rate)

All of the arguments are required for this function.

Values

Contains a series of numbers that you want used to determine the internal rate of return. The series must contain at least one positive and one negative value. For example, to determine the rate of return for a $100 investment over five years your first value in the series would be -100 followed by four positive values indicating the interest received each year (i.e., {-100, 10, 20, 25, 40, 55}.

The series of values must be enclosed in brackets ({}) and the values must be separated with commas.

Finance_Rate

Specifies a numeric value that represents the interest rate that is paid on the initial investment. For example, if you purchase a CD that pays 10% interest the value of the Finance_Rate argument is 0.1.

Reinvest_Rate

Specifies a numeric value that represents the interest rate that is paid for reinvesting the ...