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Re: st: Internal Rate of Return Calculation


From   Austin Nichols <austinnichols@gmail.com>
To   statalist@hsphsun2.harvard.edu
Subject   Re: st: Internal Rate of Return Calculation
Date   Tue, 14 Jun 2011 11:35:02 -0400

Sounds like
http://www.stata.com/statalist/archive/2010-04/msg01113.html

On Tue, Jun 14, 2011 at 2:07 AM, M. S. <shanghaiexpat09@googlemail.com> wrote:
> Dear Statalisters:
>
>  I am searching for a more convenient way to calculate internal rates
> of return. I should mention, that I am not that experienced with Stata
> at this point.
>
>  I have a function like this:
>
>  Net Present Value = Value0+ value1/(1+irr)^1+ value2/ (1+irr)^2 . . .
> + value6/(1+irr)^5*(irr-growth) – price
>
>  To find the discount rate irr that makes the function equal to zero I
> am currently using a forvalues loop which increases or decreases the
> discount factor given the current value of Net Present Value. This
> requires me to recalculate the result all the time and to use several
> if-conditions so that irr is changed by 1% at first and later by 0.1%,
> 0.01% and so on . . .
>
>  Is there a more convenient way to find the discount factor? When I
> searched, I only found a function called “finirr” but I couldn´t find
> any documentation for it and my data do not describe as a time series.
>
>  I look forward to any input you could give me on that issue and
> really appreciate every help!
>
>  Kind regards,
>
> Martin
>

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