Return on investment (ROI) and internal rate of return (IRR) are two important metrics used in evaluating investments. However, each metric is calculated differently and tells a different story.

The idea of time value of money (TVM) has fascinated finance thinkers since antiquity. A story from the Jewish Talmud (c. 500 CE) illustrates it vividly: a lender falsely claimed a loan term was 30 ...