标题: Mock exam morning session question [打印本页]

---

作者: stockjaguar    时间: 2011-7-11 15:17     标题: Mock exam morning session question

Q58 solution:

FCFE = Net income - (1-DR)(FCInv - Dep) - (1-DR)(WCInv)
= 1.8 - (1-40%)(0.3*1.8) - (1-40%)(0.1*1.8)

What is DR (40% in this case)?

---

作者: chandsingh    时间: 2011-7-11 15:17

I don't know the question but according to the formula you put it is the target debt ratio. So, you finance 40% of capex and working capital with debt, hence, only 60% of them matter for the calculation of FCFE.

---

作者: Kapie    时间: 2011-7-11 15:17

TheLegend Wrote:
-------------------------------------------------------
> Debt ratio?


Yes, the one in the capital structure concept.

---

作者: yodacaia    时间: 2011-7-11 15:17

Debt ratio?

---

作者: jacksparrow    时间: 2011-7-11 15:17

Target debt ratio = Debt/Assets

They make that confusing. It's not your debt/equity ratio. It's debt/(Debt + Equity)

---

欢迎光临 CFA论坛 (http://forum.theanalystspace.com/)

Powered by Discuz! 7.2