[recycled sixtie]

internal rate of return is such that the rate of return from a project is for example 5% after all expenses and taxes. Putting the same $ in the bank might give 1% after taxes. Then it would make sense to do that internal project in a company because you get more return on investment.

Present value principle means that a $1 today is worth more than a year from now because that same $1 is subject to inflation over one year. So future cash flows have to be discounted to present values to get more accurate comparisons. I dont pretend to be an accountant but I have done enough bus. a/c courses to understand the principles. If you are contemplating starting or buying a bus. get help with these kind of valuations. Kind of like getting a PPI on a Porsche before u buy it.