How is NPV method different from IRR method?

The Net Present Value (NPV) method calculates the difference between the present value of cash inflows and outflows over a project's lifetime, helping to assess its profitability by providing a dollar amount. In contrast, the Internal Rate of Return (IRR) method determines the discount rate that makes the NPV of a project equal to zero, essentially providing a percentage return expected from the investment. While NPV is an absolute measure of value, IRR is a relative measure of return. Additionally, NPV can give clearer insights in cases of non-conventional cash flows or multiple rates of return, whereas IRR may lead to misleading results in such scenariOS.