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NPV and PI:
The NPV method and PI method yields same accept or reject rules, because PI can be greater than one only when the project's NPV is positive. However, ranking of a set of projects obtained from NPV does not necessarily agree with that produced using PI if cash outflows are different. In fact NPV method evaluate a project in absolute terms while PI method in relative terms. The NPV method should be preferred, except under capital rationing, because it represents the net increase in the firm's wealth.
Investment timing & duration:
Some of the profitable projects may be more valuable 'if undertaken in the future. It may also be revealed that some of the unprofitable projects may yield positive NPVs if they are accepted later on. Hence firm should determine optimum timing of investment. Firm should undertake the project at that point of time, which maximizes the NPV.
Replacement of an existing Asset:
An equipment or asset should be replaced whenever a more economic alternative is available. If remaining life of old equipment & new equipment is same decision can be taken on the basis of incremental NPV on replacement. However, if lives of old & new equipment are different, correct method of analysis is to compare the annual equivalent value of future cash flows of the old and new equipment. For this purpose, current salvage value of old equipment will be taken as outflow for old equipment being an opportunity cost. So long as existing machine generate more cash inflow/less cash outflow (in terms of AEV) as compare to new equipment there does not seem to be an economic justification for replacing it.