What do you mean by NPV and IRR?

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NPV stands for Net Present Value, which is the difference between the present value of cash inflows and outflows. IRR stands for Internal Rate of Return, which is the rate at which the net present value of cash flows is zero.

NPV is used to evaluate the profitability of an investment by calculating the present value of expected cash flows and subtracting the initial investment.
IRR is the discount rate that makes the net present value of all cash flows from a particular project equal to zero.
NPV is a dollar amount, while IRR is a percentage rate of return.
A project with a positive NPV should be accepted, while a project with an IRR higher than the cost of capital is considered acceptable.
For example, if a project requires an initial investment of $100,000 and is expected to generate cash flows of $30,000 per year for 5 years, the NPV and IRR can be calculated to determine the project's profitability.

What do you mean by NPV and IRR?

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