Enron Corporation, headquartered in Houston, Texas, provides products and services for natural gas, electricity, and communications to wholesale and retail customers. Enron's operations are conducted through a variety of subsidiaries and affiliates that involve transporting gas through pipelines, transmitting electricity, and managing energy commodities. The following data were taken from Enron's December 31, 2000, financial statements.
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In millions
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Total revenues
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$100,789
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Total costs and expenses
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98,836
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Operating income
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1,953
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Net income
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979
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Total assets
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65,503
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Total liabilities
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54,033
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Total stockholders' equity
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11,470
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Net cash flows from operating activities
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4,779
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Net cash flows from investing activities
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(4,264)
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Net cash flows from financing activities
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571
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Net increase in cash
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1,086
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At the end of 2000, the market price of Enron's stock was approximately $83 per share. As of April 17, 2005, Enron's stock was selling for $0.03 per share.
Review the preceding financial statement data and search the Internet for articles on Enron Corporation. Briefly explain why Enron's stock dropped so dramatically in such a short time.