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Internal Revenue Code |
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Internal Revenue CodeThe various statutes and regulations making up federal tax law.Internal Revenue Code Similar MatchesInternal rate of returnInternal rate of returnThe interest rate which, when used as the discount rate for a series of cash flows, gives a net present value of zero.To understand this, remember the fundamental concept that £1 received in ten years is not worth as much as £1 received now, because £1 received now can be invested for ten years and compound into a higher amount.So if you are a project financier, and you are considering the viability of a project that requires up front capital expenditure, which will be recouped by net cash inflows in years 3, 4 and 5, you have to discount the earnings in those later years to establish their net present value. The discount you apply is the crucial thing, but the IRR gives you a starting point -it is the discount rate at which the project will break even.If you apply a discount rate to future cashflows that is higher than the IRR, the project will make a loss in real terms. If you apply a discount that is lower than the IRR, the project will be profitable. Incremental internal rate of returnIncremental internal rate of returnInternal rate of return (I.R.R.) on the incremental investment from choosing a larger instead of a smaller project. Internal economies of scaleInternal economies of scaleEconomies of scale that are internal to a firm; that is, the firm's average costs fall as its own output rises. Likely to be inconsistent with perfect competition. Contrasts with external economies of scale. Internal Revenue Service (IRS)Internal Revenue Service (IRS)The federal agency responsible for the collection of federal taxes, including personal and corporate income taxes, Social Security taxes, and excise and gift taxes. Internal Revenue Service Restructuring and Reform Act of 1998Internal Revenue Service Restructuring and Reform Act of 1998The legislation targeted at IRS reform, particularly related to the time period required for capital gains and taxpayer protection and rights. Further SuggestionsInternal expansionInternal finance Internal measure Internal balance Internal Revenue Service Internally efficient market Internalize Portfolio internal rate of return Internal growth rate |
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