SIE practice questioneasyMarket Cap
Market capitalization is calculated by:
- AMultiplying annual dividends by share price.
- BAdding assets and liabilities.
- CDividing annual earnings by shares outstanding.
- DMultiplying the market price per share by total shares outstanding.✓ Correct answer
Explanation
Why D — Multiplying the market price per share by total shares outstanding.
Market cap is price per share times shares outstanding. The other calculations do not yield market capitalization.
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