When discounting Free Cash Flow to Firm (FCFF), should the Weighted Average Cost of Capital (WACC) be pre-tax or post-tax?

Consider the following statement: "The estimation of the Free Cash Flow to the Firm (FCF) considers investment decisions but ignores financing decisions." Is this statement true or false? Explain your answer.

While the Weighted Average Cost of Capital reflects the risk       perceived by in investors the “real risk” is­­­­­­ ____________

1- Discuss the concept of an optimal capital structure? 2- Distinguish between business and financial risk?

The WACC is a weighted average of the costs of debt, preferred stock, and common equity. How should the capital structure weights used to calculate the WACC be determined? Would the WACC depend in any way on the size of the capital budget? How might dividend policy affect WACC? Explain

Discuss the importance of determining a firm cost of capital?

Which is easier to calculate   Multiple Choice   A firm's Net Income   A firm's Cash Flow

How does the agency theory show how Free cash flow generated impacts dividend policy positivley.

What is WACC (select all that are true)? Group of answer choices Rd (1-Tc) * D/V + Re * E/V Weighted Average Cost of Capital For a firm overall, it is based on the riskiness of the firm's assets While it is generally estimated by looking at the right-hand-side of the balance sheet, it is largely driven by the left-hand-side (i.e., assets) It is the amount that equity holders demand for an investment in a firm It is the amount that debt holders demand for a loan made to the firm

A firm’s weighted average cost of capital should not do which one of the following? Group of answer choices   measure the cost of short-term sources of funds measure cost on a marginal basis measure the cost of long-term sources of funds measure cost on an after-tax basis