Where the project is financed by debt and equity and the internal rate of return of the project is computed for a period extending beyond the amortization period of the debt, accepting the project based on the conventional method of computing the WACC using first year weights, is incorrect. Besides the fact that such a computation pre-supposes default, as the leverage is dynamic and tends to undergo changes over years, first year weights are not appropriate to make a right decision. Acceptance of projects based on such comparison will leave the investors "worse off" than before. This article recommends computation of WACC based on changing weights and proves how the conventional method is faulty.