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NPV measures the return a project generates against the costs borne to generate them, while also considering Time Value of Money. Whereas IRR measures returns alone and is hence seen as a myopic metric. NPV will be positive only when the IRR>WACC (i.e. the returns are more than the costs). The concept of IRR being greater than WACC is also called 'Positive EVA'.

Needless to say, a project must be selected when NPV > 0!

When choosing between projects, the spread between IRR & WACC will determine the financial feasibility ...the higher the better.

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