When the number of shares of common stock outstanding multiplied by the price per share is divided by the total market value of the firm the resulting value is defined as the:

Question

Quizplus · Accepted Answer

The described calculation is the process of determining the capital structure weight of the equity component of a firm. This involves comparing the market value of the equity (number of shares multiplied by price per share) to the total market value of the firm, which includes both debt and equity.

When the Number of Shares of Common Stock Outstanding Multiplied