The net present value indicates the project's profitability based on the difference between the present value of the cash inflows and outflows. The net present value and the internal rate of return analysis usually result in the same conclusions expected in the case of mutually exclusive projects. In mutually exclusive projects, there might be a conflict between net present value and internal rate of return. That's why it is suggested that you use NPV when you have mutually exclusive projects. Both net present value and internal rate of return help the manager select profitable projects. NPV is profitability in today's dollars based on the selected discount rate, which is usually weighted by the average cost of capital. IRR is the rate assuming that cash flows are invested at the internal rate of return. Why should one use NPV when analyzing mutually exclusive projects