Question

A stock's market capitalization is determined by a. Multiplying the number of shares outstanding by the...

A stock's market capitalization is determined by

a. Multiplying the number of shares outstanding by the latest stock price.

b.

Trial and error using its beta and the risk free rate.

c.

The book value of its equity times the company's debt ratio.

d.

The present value of its future cash flows discounted at the risk free rate.

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Answer #1

Stock market capitalization is computed as = Number of shares outstanding multiplied by the latest stock market price.

So answer is Option a)

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