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What is IRR

The internal rate of return (IRR) is a metric used in capital budgeting to estimate the profitability of potential investments. The internal rate of return is a discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero. IRR calculations rely on the same formula as NPV does.

What is PBP?

Payback period is an investment appraisal technique which tells the amount of time taken by the investment to recover the initial investment or principal. The calculation of payback period is very simple and its interpretation too. The advantage is its simplicity whereas there is two major disadvantage of this method. It does not consider cash flows after the payback period it also ignores the time value of money.

What is PI?

The Profitability Index (PI) measures the ratio between the present value of future cash flows and the initial investment. The index is a useful tool for ranking investment projects and showing the value created per unit of investment.

The Profitability Index is also known as the Profit Investment Ratio (PIR) or the Value Investment Ratio (VIR).


Whatttt is PBP?????

Payback period is an investment appraisal technique which tells the amount of time taken by the investment to recover the initial investment or principal. The calculation of payback period is very simple and its interpretation too. The advantage is its simplicity whereas there is two major disadvantage of this method. It does not consider cash flows after the payback period it also ignores the time value of money.

what is npv ??

NPV (Net Present Value) translated into Vietnamese: Net present value, is the present value of the entire future project cash flow discounted to the present.


 NPV is used in capital budgeting and investment planning to analyze the profitability of a project or an expected investment.


 The NPV method is derived from the idea that the present money has a higher value, along with the future money, since inflation and income from alternative investments can be made over a period of time.  In other words, a coin earned in the future will not be as valuable as a coin earned in the present.