Net Worth = Assets - _______
Show answer & explanation
Correct answer: D
Explanation
The correct answer is Option 4 i.e. Liabilities
Net Worth = Assets - Liabilities
- A person or business is said to have a positive net worth if their assets exceed their liabilities.
- A negative net worth is implied when liabilities exceed assets.
- While a negative net worth might be interpreted as a bad indicator of one's incapacity to pay debts, a positive net worth is linked to sound financial health.
- There are several ways to use the idea of net value.
- A person, a group, an organisation, a government, or even an entire city or nation can use it.
- We shall restrict our discussion to the net worth of individuals or organisations in order to keep things simple.