Hey guys! I noticed that I’ve been making mistakes in questions with regards to FCFF and FCFE cause I usually forgot to subtract the market value of debt to get equity value.
When is it appropriate to subtract market value of debt when arriving at FCFF/FCFE? Are there specific keywords that I’d need to look at in the phrasing of the question/the given data? I noticed that it doesn’t need to be subtracted when the formula is FCFE = NI - [(1 - DR) x (FCInv - Dep)] - [(1 - DR) x WCInv]