This quote is taken from Act III, Scene V, and is spoken by Juliet's mother, Lady Capulet. To put this into context, Juliet has refused to marry Paris, and her parents are both annoyed and exasperated by her feelings on this subject.
In terms of its literal meaning, Lady Capulet is saying here that her daughter is a "fool" for not wanting to marry Paris. Moreover, Lady Capulet wishes that Juliet were dead and, therefore, married to her grave. Looking deeper, Lady Capulet's fury is apparent: she cannot understand why Juliet would refuse such a handsome and successful suitor. She is so angry that she would rather see Juliet dead than have her daughter continue on this path of complete defiance. After all, in this setting it is a woman's duty to get married and to have a family. By marrying well (with Paris), Juliet ensures the prosperity and respectability of the Capulet name and the Capulet family.
Of course, Lord and Lady Capulet have no idea that Juliet is refusing Paris because she has already married Romeo and, earlier in this scene, has consummated that marriage.
In Act Three, Scene 5, Lady Capulet tells Juliet that she will marry Paris on Thursday. Juliet is shocked and disturbed at this news. Juliet then tells her mother that she refuses to marry Paris so soon. When Lord Capulet enters the scene, he asks his wife where Juliet stands on their decision to have her marry Paris. Lady Capulet responds by telling her husband, "Ay, sir, but she will none, she gives you thanks. I would the fool were married to her grave!" (Shakespeare, 3.5.139-140). Lady Capulet is essentially calling her daughter a fool and wishes that Juliet were dead for not obeying their decision. Lady Capulet is extremely disheartened that Juliet refuses to marry Paris. Her comments are also significant because they foreshadow Juliet's death later on in the play. Lord Capulet is initially confused after hearing his wife's comment, and Juliet elaborates on her decision not to marry Paris. Lord Capulet responds by ridiculing his daughter and mentions that Juliet disgusts him.
Because Juliet will not agree to marry Paris, Lady Capulet states the above quote (line 140). Lady Capulet is stating that it would seem that Juliet is married to her grave because she would rather be with Romeo than marry Paris (Marrying Romeo would be the death of Juliet, figuratively, as she would be marrying into the Mercutio family). This line is also used as an element of foreshadowing, as Juliet does actually die at the end of the play.
This line is spoken by Lady Capulet (Juliet's mother) in Act III, Scene 5. She says it about her daughter. What she is saying (and this is really a terrible thing to say) is that she wishes her daughter were dead.
She says this because she is mad at Juliet. She is mad because of the fact that Juliet does not want to marry Paris when that seems like such a wonderful match to her parents.
By saying this, Lady Capulet is sort of foreshadowing what will actually happen to her daughter -- she will soon be dead, just as her mother is wishing for in this passage.
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