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More debt will not affect FCFF, but will affect FCFE (interest payments up, FCFE down). The main purpose of FCFF is to measure the operating free cash flow that goes to all capital providers, whether debt or equity.
The amount of debt will change the Enterprise Value of the firm, however, since EV = sum of future FCFFs discounted at WACC. Since debt levels will affect WACC, it will affect EV, but not FCFFs. |
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发表于 2011-7-13 14:29
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