Multiple IRR: Combining internal/external fund optimization, risk and opportunity losses

Ean Harn Ng, Mario G. Beruvides

Research output: Contribution to conferencePaper

Abstract

A conceptual framework was developed which incorporates the combination of internal and external refinancing/reinvestment of interim cash flow, the potential risk incurred and utilizing optimization to maximize the IRR obtained. This framework addresses the multiple IRR problem and diverges from most other methods proposed in two ways: This model incorporates most of the variables involved in rate of return analysis, which includes risk, opportunity cost, internal/external refinancing/reinvestment of interim cash flow; this model utilizes optimization technique with the objective of maximizing IRR. The research attempts to develop a model that would provide a unique IRR that could be used for decision making.

Original languageEnglish
Pages425-429
Number of pages5
StatePublished - 2007
Event28th Annual National Conference of the American Society for Engineering Management 2007 - Innovation Management: Innovation in a Flattened World, ASEM 2007 - Chattanooga, TN, United States
Duration: Nov 7 2007Nov 10 2007

Conference

Conference28th Annual National Conference of the American Society for Engineering Management 2007 - Innovation Management: Innovation in a Flattened World, ASEM 2007
CountryUnited States
CityChattanooga, TN
Period11/7/0711/10/07

Keywords

  • Internal and external refinancing/reinvestment
  • Multiple IRR
  • Opportunity cost

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