What do you know about Internal Rate of Return (IRR)?
In financial analysis, there is a method named internal rate of return (IRR) which is being used for profitability estimation of the potential investments. In a discount cash analysis, IRR makes the net present value of all cash flows equal to zero, therefore IRR is a discount itself. The formula of IRR calculation is similar to the NPV. All in all, the higher IRR means that the investment is more desirable. Therefore you can use it as a comparative tool as well. For more explanation, please watch the video.
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