School of Business Professors Chee Ng and Xinxin Li, along with their coauthor Charlie Charoenwong from Nanyang Technological University, published their paper " How To Create Cash Flows That Give A Priori IRRs?" in Southwestern Business Administration Journal.
This paper illustrates algebraically the way to numerically derive the cash flows of an investment project yielding a set of desired IRRs. This is significant given the dearth of practice questions with the appropriate cash flow numbers, and their corresponding sign, in widely adopted Finance textbooks that will allow students to find multiple IRRs as learning exercises. The note serves to fill that void by allowing the readers to change the IRR inputs in an Excel spreadsheet and have the corresponding cash flows output ready for an assignment. Instructors can use the Excel codes to create different cash flows that yield multiple IRRs with ease so that students in the same class or those in different semesters need not be given the same set of cash flows where plagiarism could compromise the learning process.
Congratulations Drs. Li and Ng!