Investments and Depreciation

Capital Assets

• Examples of capital assets include buildings, machinery, equipment, vehicles, and other tangible assets used in the production of goods and services.

Depreciation

• Depreciation is the decrease in value of a capital asset over time due to wear and tear, outdated technology, or obsolescence.

Investments in the Economy

• Investments in the economy include expenditures on capital assets, such as buying new buildings or machinery, as they contribute to the production of goods and services and stimulate economic growth.

Test your knowledge about investments, capital spending, and depreciation in the economy. Understand the concept of injecting capital into assets for production and the effects of asset wear and tear.