In the knowledge economy, if a large portion of a firm's value is in intellectual and human assets, the difference between the company's market value and book value should ___________ a company with mostly physical and financial assets.
A) be equal to
B) be smaller than
C) be larger than
D) not be correlated with

Question

Quizplus · Accepted Answer

The difference between a company's market value and book value tends to be larger for firms with significant intellectual and human assets compared to those with mostly physical and financial assets. This is because intellectual and human assets often have a high value that is not fully captured on the balance sheet, leading to a greater disparity between market and book values.

In the Knowledge Economy, If a Large Portion of a Firm's