55=(3.93/(1+IRR)) + (9.1/(1+IRR)^2) + (6.93+57.75/(1+IRR)^3) How do you calculate for IRR?
+128474 I assume this is :
55=(3.93/(1+IRR)) + (9.1/(1+IRR)^2) + (6.93+57.75)/(1+IRR)^3)
Let (1 + IRR) = x so we have
55 = 3.93 / x + 9.1/x^2 + 64.68/x^3 multiply throgh by x^3
55x^3 = 3.93x^2 + 9.1x + 64.68 rearrange as
55x^3 - 3.93x^2 - 9.1x - 64.68 = 0
The easiest way to solve this is with a graph :
http://www.wolframalpha.com/input/?i=55x%5E3+-+3.93x%5E2+-+9.1x+-+64.68++%3D+0
So x = 1.13322
And 1 + IRR = x ... so...
IRR = x - 1
IRR = 1.13322 - 1 = .13322 = 13.322%
