depreciation

Vocabulary Word

Definition

You've probably heard of things losing their value over time. That's called 'depreciation'. It's like when a new car isn't worth as much after it's been driven for a year.

Examples in Different Contexts

While 'depreciation' is more common in financial contexts, in creative fields, it might refer to the diminishing relevance or effectiveness of an idea or design. A creative director might say, 'The original concept has seen some depreciation; we should brainstorm fresh ideas.'

Practice Scenarios

Business

Scenario:

We have recently made some significant investments in office renovations and equipment upgrades. It's crucial to account for the corresponding costs.

Response:

We should account for depreciation in the budget, which will increase our productivity gains from these investments.

Real-Estate

Scenario:

This building has been a significant investment for us. However, we must consider potential costs related to aging and maintenance.

Response:

We must ensure regular maintenance to minimize depreciation damage due to age and natural wear.