How is the market value of a share of stock determined?

Question

whcih if these is the correct answer?

a. by dividing total assets by the number of outstanding shares

b. dividing total share holder and apos equity by the number of outstanding shares

c. what buyers are willing to pay for the share

d. dividing net profit by the number of outstanding shares

Help im so lost on this one!!!

Answer 1

C is the correct answer.  The market value (as opposed to "book" value) is the price that buyers are willing to pay.

Answer 2

Yeah I think its (c) too. Market prices are determined by the supply and demand of the investors of that particular stock.

(d) is the earnings per share formula that tells you how much earnings can be distributed to shareholders. rather, it is a benchmark that investors can look at to determine how much they can gain from holding the stock.

(b) is the manipulation of the market capitalization formula which shows the size of the company when the weighted average number of shares is multiplied by the stock price.

(a) is the formula for net total assets over number of outstanding shares.

Answer 3

It is demand and supply factor's along with the host of other factors like inflation, government policies etc decide the share prices.