The Existence of Goodwill on a Corporate Balance Sheet Indicates

question 42

Multiple Choice

The existence of goodwill on a corporate balance sheet indicates that the corporation has:

• A) been profitable in the past.
• B) depreciated its tangible assets.
• C) intangible assets from past acquisitions.
• D) retained earnings resulting from past income.

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Definitions:

Long-run Equilibrium

A state in which all aspects of the market, including supply, demand, and price, are stabilized over time, allowing for full adjustment to any economic changes.

MR = MC

This equation represents the profit-maximizing condition in economics where marginal revenue (MR) equals marginal cost (MC), often used to determine the optimal level of output.

Competitive Price-searcher

A market participant who actively compares prices among competitors to find the best possible deal, often in markets with imperfect competition.

Short-run Losses

Financial losses that a firm experiences within a limited time period, usually due to fixed costs and market conditions.