This method solves for the interest rate that equates the equivalent worth of an alternative’s cash inflows (receipts or savings) to the equivalent worth of cash outflows (expenditures, including investment costs). Equivalent worth may be computed using any of the three methods discussed earlier. The resultant interest rateistermedtheInternalRateofReturn(IRR).TheIRRissometimesreferredtoas thebreakeveninterestrate.