Michonne Corp.'s Free Cash Flow (FCF) for the most recent year (year 0) is $730 (million). FCF is expected to grow by 14% next year (1 year from now), by 10% the year after that (2 years from now), and by 5% per year thereafter. Michonne's WACC is estimated at 8%. The estimated Enterprise Value (Value of Operations) for Michonne is $(million).

enterprise value = $29,024.26 million

Explanation:

first we must calculate the terminal value in year 2:

terminal value = FCF₃ / (WACC - g)

terminal value = $961.191 / (8% - 5%) = $32,039.70

enterprise value = $832.2/1.08 + $915.42/1.08² + $32,039.70/1.08² = $770.556 + $784.825 + $27,468.879 = $29,024.26 million

the answer is "b.the increased supply will create a surplus. "

the essential thought behind price controls is straightforward - utilize the power of law to modify the equilibrium of a market. for instance, the legislature may choose that the steel business needs to survive, and in this way pass a law to set a value floor on steel. this implies all steel sold must offer at or over the floor value, which must be set over the equilibrium cost for it to have any impact. the switch could likewise happen - the administration can choose that steel is excessively costly and set a value roof underneath its equilibrium value, with the goal that all steel must be sold at or beneath that ceiling.