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Net worth represents the total value of an entity’s assets minus its total liabilities. It serves as a crucial indicator of financial health, providing a snapshot of an individual’s or company’s economic standing at a specific moment. For an individual, assets can include cash, investments, real estate, and other valuable possessions, while liabilities encompass debts such as mortgages, loans, and credit card balances. Understanding this calculation is fundamental for financial planning and assessing economic stability. …