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Divide by 0 Error using IRR function


Posted by Steve on March 13, 2001 1:06 PM

I am trying to figure out what would cause a div/0 error when doing an irr function


Posted by Tim Francis-Wright on March 14, 2001 7:26 AM

It is possible that you have an IRR that is
infinite--one way to diagnose it is by using
NPV(rate, cashflowrange) to see whether higher
and higher discount rates fail to bring the
NPV below zero. For example, the following
cash flow stream yields an IRR of #DIV/0:
0;1000;10000;-100;10000;-10000;100;100;10000.
For these sorts of streams, applying a fixed
discount rate and using an NPV is a good
alternative to IRR.