The Internal Rate of Return (IRR) is the average annual return rate used in the capital budgeting to measure and compare the profitability of investments that is the one of the two discounted cash flow (DCF) techniques (the other is net present value or NPV).
Reference Definition by Investopedia: The Internal Rate of Return (IRR) is a metric used in capital budgeting measuring the profitability of potential investments. 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.
Related Definitions in the Project: The Project Cost; Economic Reviews; Commercial Definitions
