mp3bu

Unfortunately Iginla is correct. I hate agreeing with him because he's a dick. WACC will be lower than Re because debt has a lower rate than equity, and debt gets into the mix in WACC.

with that understood, you can lay out some figures to solve, using any two simple rates where one is lower than the other. I've chosen .10 (r) and .07 (WACC) for no particular reason.

FCFF = 150
FCFE = 100
r = .10
WACC = .07

FCFF
using wacc, 150/1.07 = 140.19 ; the correct figure
using r, 150/1.1 = 136.36 ; PV of FCFF is too low, it has been understated

FCFE
using r, 100/1.1 = 90.91 ; the correct figure
using wacc, 100/1.07 = 93.45 ; PV of FCFE is too high, it has been overstated