180 Appendix C: More About L
Your guess will aid the calculator in its search, and if it finds an IRR answer near
your guess, that answer will be displayed. Since the calculator cannot tell you the
number of solutions that exist when there is more than one mathematically cor-
rect answer, you can continue to make guesses, pressing :gt after each
one, to search for IRR solutions.
You can hasten this process by using the l function to help you make a good
guess. Remember that a correct IRR solution will make the calculated NPV very
small. So continue to guess interest rates and solve for NPV until the answer you
obtain is reasonably close to zero. Then press :gt to calculate the IRR
answer near your guess.
How would this work in case 2 above? The calculator displays a negative answer
and you wish to check for a unique positive IRR. Key in successively larger
guesses for i (starting from 0) and solve for NPV until you reach a sign change in
your NPV outcomes. Then press :gt to find an IRR solution near the
last interest rate obtained using the l key.
If you stop the IRR iterative process, you can test the interest obtained using
l, and then restart the process by pressing :gt.
To Next Page
Loading...
