A stock market comprises 1000 shares of stock A and 3000 shares of stock B.The share prices for stocks A and B are $25 and $30,respectively.What is the capitalization of the market portfolio?

Question

Quizplus · Accepted Answer

The capitalization of the market portfolio is the sum of the market values of all the stocks in the portfolio. The market value of a stock is the number of shares outstanding multiplied by the share price. For stock A, the market value is 1000 * $25 = $25,000. For stock B, the market value is 3000 * $30 = $90,000. Therefore, the capitalization of the market portfolio is $25,000 + $90,000 = $115,000.

A Stock Market Comprises 1000 Shares of Stock a and 3000