market value
Quick Summary
Market value refers to the price at which something can be sold or the price buyers are willing to pay for it. In economics, market value is determined by the interaction of supply and demand in a market. This interaction establishes an equilibrium price where the quantity supplied equals the quantity demanded.12
For assets, value can be computed in several ways. One method is calculating what the assets are worth to their owners, based on expected future cash inflows. Another is the fair market value, which is the amount obtainable by selling the assets. Market capitalization, specifically for companies, is the total value of all outstanding shares, calculated by multiplying the stock price by the number of shares. This metric helps categorize companies and can influence investment strategies. In options trading, intrinsic value is a component of an option's price, representing the amount by which it is "in the money".345
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