In an economic sense, goodwill created in an acquisition represents blue sky, that is, the acquiring
ﬁrm is essentially paying a premium for the purchase and getting nothing of value for this part of the
price.

Question

Quizplus · Accepted Answer

Goodwill represents the intangible assets acquired in an acquisition, such as brand reputation, customer relationships, and intellectual property, which are considered valuable despite not being physical assets.

In an Economic Sense, Goodwill Created in an Acquisition Represents