How do I calculate the final pmt required to meet a target IRR?

  • Thread starter Vasant Nanavati
  • Start date
A

Alex

An investor will be investing 2,500 in year 1, not taking any return for 5
years, but at the end of year 6 wants a payment so that his IRR upon
receiving that payment will equal 25%. Help!
 
A

Alex

I can use goal seek to determine the number, but what I need is a tool that
will change that answer as I change the variables, e.g. the amount of the
original investment.
 
J

joeu2004

Alex said:
An investor will be investing 2,500 in year 1,
not taking any return for 5 years, but at the
end of year 6 wants a payment so that his IRR
upon receiving that payment will equal 25%.

If I understand you correctly, you simply want
the future value (FV) a 6-year investment of
$2500 at 25% per year.

=FV(25%,6,,-2500)
 
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