Question 2 from UPSC CSE 2023 - Economics

Question

Consider the investments in the following assets:
1. Brand recognition
2. Inventory
3. Intellectual property
4. Mailing list of clients
How many of the above are considered intangible investments?

IASCODEX · Accepted Answer

Correct Option: C. Only three

Strategy: - Identify assets based on their physical substance.
- Classify Inventory as tangible due to its physical form.
- Recognize Brand recognition, Intellectual property, and client mailing lists as intangible assets.
- Exclude inventory and count the remaining intangible assets.

Key Info: Intangible assets are non-physical, identifiable assets with economic value.

### Examples of Assets

- **Brand recognition** -- Value built through marketing, reputation, or customer loyalty. It has no physical form but adds business worth.
- **Intellectual property** -- Legal rights (e.g., patents, trademarks, copyrights) granting exclusive use, protection, or benefit. These lack physical form but provide economic benefits.
- **Mailing list of clients** -- Lists of client contact information used for business communication or marketing. Considered intangible due to non-physical nature and business value.
- **Inventory** -- Physical goods held for sale or production; classified as a tangible asset with measurable physical form.

Intangible investments are recorded in accounting and financial statements as assets with future economic value, while tangible investments involve physical objects like inventory, machinery, or buildings.

IASCODEX · Answer

Option A: Only one

IASCODEX · Answer

Option B: Only two

IASCODEX · Answer

Option D: All four

Consider the investments in the following assets: Brand recognition Inventory Intellectual property Mailing list of clients How many of the above are considered intangible investments?

Consider the investments in the following assets:

Brand recognition

Inventory

Intellectual property

Mailing list of clients
How many of the above are considered intangible investments?