The Development and Usage of NPV and IRR and Their Comparison
- 10.2991/assehr.k.211209.334How to use a DOI?
- Net present value; Internal rate of return; Capital budgeting techniques
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.
- © 2021 The Authors. Published by Atlantis Press International B.V.
- Open Access
- This is an open access article under the CC BY-NC license.
Cite this article
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 -