Question 20 Exam I Schweser Practice Exam

Question 20 on Practice Exam 1 uses FCFF without any que in the question. I didn’t see anything in the question that would give preference to FCFF over FCFE. What did I miss?

Post the question (I don’t have schwesser)

You are to calculate value of the firm so use FCFF. If questions asked about value of equity or share price than you could use FCFE or FCFE and then suttract debt.

Good call. Thanks Kobi.