The capitalization rate when figuring goodwill should be a figure assigned to show ______.

A) risk and expected growth rate of future earnings
B) risk and profit minus taxes
C) expected growth rate and profit
D) expected growth rate and the value of tangible assets

Capitalization Rate

A real estate valuation measure used to compare different investments, calculated as the ratio between the net operating income produced by an asset and its capital cost.

Goodwill

An intangible asset that represents the value of a company's brand, customer relationships, and reputation beyond its tangible assets and liabilities.

Expected Growth Rate

Expected growth rate is the projected percentage increase in the value of an investment, company revenue, or economy over a specific time period.