What are intangible assets?

Intangible assets are defined as non-physical assets that provide economic value to a company. These assets can include intellectual property such as trademarks, patents, copyrights, and trade secrets, as well as non-physical resources like brand reputation, customer relationships, and proprietary technologies. Their significance lies in the fact that they can contribute to a company's competitive advantage and generate future economic benefits, even though they do not have a physical form.

In contrast, the other options refer to tangible or physical possessions. Physical goods, such as inventory or machinery, and real estate properties are classified as tangible assets, meaning they have a physical presence and can be seen or touched. Financial investments, while potentially providing economic value, do not fall under the category of intangible assets because they represent ownership in other companies or securities rather than providing value derived from non-physical attributes. Thus, the correct identification of intangible assets as non-physical resources is crucial for understanding their role in strategic management and overall business valuation.