Depreciation, << dih `pree` shee AY shuhn, >> is the loss of value. Buildings, machines, vehicles, and other property depreciate (lose value) through use or accident, because they grow older, or because a new, better product replaces them. In accounting, depreciation is figured as a normal cost of doing business.
The term depreciation is also used to mean the loss of value or of purchasing power resulting from an increase in the level of domestic prices. In this sense, the term refers to the currency of a country declining in value relative to currencies of other countries.
