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210 14: Additional Examples
File name : English-M02-1-040308(Print).doc Print data : 2004/3/9
a liquid account. The figure generally used is a short-term security (T-bill)
or bank passbook rate. Positive cash flows are reinvested at a
reinvestment rate that reflects the return on an investment of comparable
risk. An average return rate on recent market investments might be used.
1. In the CFLO menu, calculate the present value of the
negative cash
flows (
NPV) at the safe rate and store the result in register 0. Enter
zero for any cash flow that is positive.
2. Calculate the future value of the
positive cash flows (NFV) at the
reinvestment rate and store the result in register 1. Enter zero for any
cash flow that is negative.
3. In the TVM menu, store the total number of periods in
N, the NPV
result in
PV, and the NFV result in FV.
4. Press to calculate the periodic interest rate. This is the
modified internal rate of return, MIRR.
Example: Modified IRR. An investor has an investment opportunity with
the following cash flows:
Group
(FLOW no.)
No. of Months
(#TIMES)
Cash Flow, $
0
1
2
3
4
1
5
5
9
1
－180,000
100,000
－100,000
0
200,000
Calculate the MIRR using a safe rate of 8% and a reinvestment (risk) rate
of 13%.
Keys: Display: Description:
Displays current cash-flow
list.
@c
Clears current list or
g
ets a