n NISM Certifications
XV NISM Series XV
Medium

How is Free Cash Flow to Equity (FCFE) calculated?

Practice question from NISM XV Mock Test 6 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Interest payment on equity is subtracted from Free Cash Flow to the firm and net borrowings are deducted

  2. B

    Interest payment on debt is added to Free Cash Flow to the firm and net borrowings are deducted

  3. Interest payment on debt is subtracted from Free Cash Flow to the firm and net borrowings added

    Correct answer

  4. D

    Interest payment on equity is subtracted from Free Cash Flow to the firm and net borrowings added

A full explanation for this question is being written. In the meantime, the correct answer is highlighted above.

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