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Real estate projects and multiple internal rates of return

Real estate projects and multiple internal rates of return Examines the problem of multiple solutions in relation to the useof the internal rates of return IRR as a decisionmaking criterion.Attempts to show that positive multiple IRRs occur only in a limitednumber of cases and in such cases the IRR is not the appropriate measureof return. Argues instead that the true rate of return for such projectsis shown to be dependent on the cost of capital. Suggests two methods todeal with this problem the extended yield method and the return oninvested capital method. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Valuation Emerald Publishing

Real estate projects and multiple internal rates of return

Journal of Valuation , Volume 7 (3): 16 – Mar 1, 1989

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Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
0263-7480
DOI
10.1108/EUM0000000003264
Publisher site
See Article on Publisher Site

Abstract

Examines the problem of multiple solutions in relation to the useof the internal rates of return IRR as a decisionmaking criterion.Attempts to show that positive multiple IRRs occur only in a limitednumber of cases and in such cases the IRR is not the appropriate measureof return. Argues instead that the true rate of return for such projectsis shown to be dependent on the cost of capital. Suggests two methods todeal with this problem the extended yield method and the return oninvested capital method.

Journal

Journal of ValuationEmerald Publishing

Published: Mar 1, 1989

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