In general, the greater the difference between the magnitude and/or timing of cash inflows, the greater the likelihood of conflicting ranking between NPV and IRR.

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This is a well-known phenomenon in financial analysis, often referred to as the "cash flow timing problem" or "multiple IRR problem". When the cash flows of a project have non-conventional patterns, such as multiple changes in sign or more than one sign change, the IRR can generate multiple values or even fail to exist. Hence, the decision maker may face a dilemma when choosing between projects with conflicting NPVs and IRRs, and must resort to additional criteria, such as payback period, profitability index or sensitivity analysis.

In General, the Greater the Difference Between the Magnitude And/or