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Market Capitalization: A Key Measure of Company Value

What is Market Capitalization?

Market capitalization (market cap) is a crucial metric that measures the total value of a publicly traded company's outstanding shares. It represents the collective perception of the market about the company's worth.

How Market Cap is Calculated

Market cap is calculated by multiplying the current share price by the total number of outstanding shares. For example, if a company has 10 million outstanding shares and each share is trading at $10, its market cap would be $100 million.