What calculation determines the Enterprise Value of a company with given long-term debt and equity?

The calculation for Enterprise Value (EV) is given by the formula: EV = Market Value of Equity + Total Debt - Cash and Cash Equivalents. In this context, Market Value of Equity generally refers to the company's market capitalization, which is derived from its stock price.

Enterprise Value provides a more comprehensive measure of a company's total value than market capitalization alone, as it accounts for the entire capital structure—both debt and equity—while also adjusting for the cash that could be used to pay off some of that debt.

Long-term debt represents the company's financial obligations, while equity reflects the value attributable to shareholders. Cash and cash equivalents, on the other hand, can be used to reduce the company’s net debt; hence, they are subtracted in the calculation. This allows investors to assess the total cost to acquire the business or the enterprise's operational value more accurately.

The other options either include cash incorrectly or alter the fundamental components that define enterprise value, which is why they do not represent the correct calculation for EV.