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For mutually exclusive projects, when NPV and IRR rankings conflict, prefer:
AIRR
BNPV
CPayback
DARR
Answer & Solution
Correct answer: B. NPV
1. NPV is the theoretically superior criterion.
2. NPV measures absolute value addition; IRR can give misleading rankings for unequal-size or unequal-life projects.
3. When they conflict, follow NPV.
_Source: ICAI BoS CA Inter Paper 6A, Ch 7 "Investment Decisions", §8 vs §7_