Deletion of regular wear and tear capital from the value of gross investment is called _____

Key Points

• Depreciation refers to the reduction in the value of an asset over time due to regular wear and tear, obsolescence, or usage.
• It is subtracted from the gross investment to calculate the net investment.
• Depreciation is a non-cash expense and an important accounting concept used to allocate the cost of assets over their useful life.
• It helps in understanding the true value of fixed assets in a business or economy.

Important Points

• Gross investment includes all expenditures on new capital assets and replacement of depreciated assets.
• Net investment is calculated by subtracting depreciation from gross investment.
• Depreciation is a crucial factor in evaluating the sustainability and growth of businesses and economies.