Pitfalls of using internal rate of return to rank investments in forestry

David A. Gansner; David N. Larsen

Treesearch

Pitfalls of using internal rate of return to rank investments in forestry

Informally Refereed

Authors:

David A. Gansner, David N. Larsen

Year:

1969

Type:

Research Note

Station:

Northern Research Station

Source:

Research Note NE-106. Upper Darby, PA: U.S. Department of Agriculture, Forest Service, Northeastern Forest Experiment Station. 5p.

Download (PDF 213 KB)

Download (PDF 213 KB): https://research.fs.usda.gov/download/treesearch/19826.pdf

Abstract

Using the internal rate of return concept to rank the economic desirability of investment opportunities can lead to incorrect investment decisions. Present value provides a correct and unambiguous means of judging such investment alternatives.

Citation

Gansner, David A.; Larsen, David N. 1969. Pitfalls of using internal rate of return to rank investments in forestry. Research Note NE-106. Upper Darby, PA: U.S. Department of Agriculture, Forest Service, Northeastern Forest Experiment Station. 5p.