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Market Capitalization: CNBC Explains

CNBC Explains
Thursday, 16 Jun 2011 | 11:07 AM ET
Market Capitalization: CNBC Explains
A company's market capitalization, also known simply as 'market cap,' is an indication of how much that company is worth on the open market. How do you compute a company's market capitalization? How does it differ from the book value? Using two hypothetical examples, Salman Khan of the Khan Academy explains.

A company’s market capitalization, also known simply as “market cap”, is an indication of how much that company is worth on the open market. How do you compute a company’s market capitalization? How does it differ from the book value? Using two hypothetical examples, Salman Khan of the Khan Academy explains.

From this video, you’ll understand:

  • How market capitalization is determined
  • How a company’s market cap differs from book value explains.



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