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How to work out net present value and internal rate of return on a TI-84 Plus CE, TI-84 Plus or TI-83 Plus

By E-Code · updated

Press APPS, ENTER for Finance and 7 for npv(, then type the rate, the money out now as a negative and the later amounts as a list: npv(10,-1000,{300,400,500}) is −21.04. APPS, ENTER, 8 gives irr(, the same without the rate: irr(-1000,{300,400,500}) is 8.90%.

Step by step

  1. Open APPS. APPS Press APPS.
  2. Open Finance. ENTER Press ENTER for Finance.
  3. Pick npv(. 7 Press 7 for npv(, the net present value: every payment valued in today's money.
  4. Rate and money out now. 1 0 , (-) 1 0 0 0 , Type 10 , (−) 1000 ,: a 10% rate, and 1,000 dollars paid out today.
  5. Money back each year. 2nd ( 3 0 0 , 4 0 0 , 5 0 0 2nd ) ) Type 2nd ( for {, then 300 , 400 , 500, 2nd ) for } and ): 300 dollars, 400 dollars and 500 dollars back over the next 3 years.
  6. Net present value. ENTER Press ENTER.
  7. Pick irr(. APPS ENTER 8 Press APPS, ENTER, then 8 for irr(: the rate at which the deal breaks even.
  8. Same cash flows. (-) 1 0 0 0 , 2nd ( 3 0 0 , 4 0 0 , 5 0 0 2nd ) ) ENTER Type (−) 1000 , {300,400,500} ) and ENTER: the same deal, without a rate.
  9. Worth it or not. npv = −21.04 is below 0, so at 10% the deal loses a little. irr = 8.90%: it only pays off if your money earns less than 8.9% elsewhere.

What the screen shows

npv = −21.04 is below 0, so at 10% the deal loses a little. irr = 8.90%: it only pays off if your money earns less than 8.9% elsewhere.

Look for 8.896339469 on the screen.

Try it with the keys lit up

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