Depreciation is also known as:
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → Consumption of fixed capital
Depreciation is the wear and tear of capital during production. Its other name is consumption of fixed capital.
NCERT (2026-27): “2.2.1 The Product or Value Added Method … We have already introduced the concept of depreciation, which is also known as consumption of fixed capital. …” Glossary: “Depreciation – Wear and tear or depletion which capital stock undergoes over a period of time.” |