Define market capitalization.

Market capitalization is defined as the total market value of a company's outstanding shares of stock. This metric provides a quick way for investors to gauge the size of a company and its overall value in the stock market. It is calculated by multiplying the current share price by the total number of outstanding shares.

Market capitalization is significant because it helps investors understand the relative size of a company compared to others in the market, and it is often used to categorize companies into different segments such as large-cap, mid-cap, and small-cap. This categorization can influence investment decisions, as different market capitalizations may represent different risk profiles and growth potential.

The other descriptions do not accurately capture the essence of market capitalization. Total revenue pertains to the income a company generates, initial capital refers to funds raised during the startup phase, and total expenses are associated with the costs incurred in operations. These aspects are crucial for assessing a company’s financial health but do not define its market capitalization.