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A Refresher on Internal Rate of Return

Harvard Business Review

There are a variety of methods you can use to calculate ROI — net present value , payback, breakeven — and internal rate of return , or IRR. What is internal rate of return? The IRR is the rate at which the project breaks even. How is it calculated? It’s not a straightforward calculation.

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Promote Healthy Behaviors

Eric Jacobson

Hopefully, you're setting a good example for your team by eating well, exercising and leading them to practice a healthful lifestyle. Negotiate gym membership discounts with fitness clubs near your office for your employees. Fit, well-nourished, healthy employees perform better. Subsidize smoking cessation classes.

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A Refresher on Payback Method

Harvard Business Review

There are a variety of ways to calculate a return on investment (ROI) — net present value , internal rate of return , breakeven — but the simplest is payback period. Knight provides an example. Say, for example, the cash flow for the project was actually $3,000/year in Year 1 and nothing thereafter.

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A Refresher on Cost of Capital

Harvard Business Review

You may be wondering if this is the same as discount rate and the terms are sometimes used interchangeably, explains Knight. Then the management team takes that number and decides on the discount rate, or hurdle rate, that you have to exceed to justify an investment,” he says. or 11% as the discount rate.