Question

Money value of the business reputation ?

Answer 1

• Goodwill

  Explanation:

  Goodwill is an intangible asset of the firm. It is the value of firm’s reputation and good brand name in the market. A firm earns goodwill by its hard work and thereby winning the blind trust and faith of its customers by fulfilling their demand in both qualitative and quantitative aspects. A positive goodwill helps the firm to earn supernormal profits compared to its competitors that earns normal profits (which is equal to zero).