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ESTIMATING THE INTERNAL RATE OF RETURN FROM PUBLISHED FINANCIAL STATEMENTS: A COMMENT
Author(s) -
Jegers M.
Publication year - 1985
Publication title -
journal of business finance and accounting
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.282
H-Index - 77
eISSN - 1468-5957
pISSN - 0306-686X
DOI - 10.1111/j.1468-5957.1985.tb00798.x
Subject(s) - internal rate of return , rate of return , economics , modified internal rate of return , time weighted return , econometrics , actuarial science , financial economics , finance , rate of return on a portfolio , microeconomics , return on investment , investment performance , portfolio , production (economics) , portfolio optimization
In a recent issue of this journal T. Salmi attempted to estimate the internal rate of return from published financial statements. Two reasons lead to the conclu‐ sions that his approach is partly in error. The first is a technical one. Also it has been proved that his objective, estimating the IRR in the case that it is approximately equal to the growth rate, can be reached in a much simpler way.