n NISM Certifications
XV NISM Series XV
Medium

The market capitalization of a company is ₹8,00,000. Its Price to Book (P/B) ratio is 10, and the Book Value is ₹14. Calculate the Net Worth of the company.

Practice question from NISM XV Mock Test 3 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    ₹40,000

  2. B

    ₹50,000

  3. C

    ₹60,000

  4. ₹80,000

    Correct answer

Why this is the answer

Price to Book ratio = Market Capitalization / Net Worth. 10 = 8,00,000 ÷ Net Worth. Net Worth = 8,00,000 ÷ 10 = ₹80,000.

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