Economics · Net Asset Value
How does an investment company compute its Net Asset Value (NAV) per share?
- 1By subtracting capital gains from the total assets and dividing by the number of preferred shares
- 2By dividing the total market value of all securities owned directly by the number of outstanding shares without considering liabilities
- 3By adding total liabilities to the market value of all securities owned and dividing by the number of authorized shares
- 4By subtracting total liabilities from the market value of all securities owned and dividing by the number of outstanding shares✓
Correct answer
By subtracting total liabilities from the market value of all securities owned and dividing by the number of outstanding shares
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