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lesson pretestMultiple Choice

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Question 1 • Mathematics for Data and Financial Literacy

What is the definition of net worth in a business context?

Answer
A
the total cash on hand
B
the total value of property and equipment
C
the total revenue generated in a year
D
the difference between total assets and total liabilities

Explanation

Net worth is calculated by subtracting total liabilities (what a business owes) from total assets (what it owns). For example, if assets are $100,000 and liabilities are $60,000, net worth is $40,000. So the correct choice is the difference between total assets and total liabilities.

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