Why do assets lose value or depreciate?

Assets lose value or depreciate due to factors such as wear and tear, technological obsolescence, and changes in market demand. Physical assets, like vehicles and machinery, naturally deteriorate over time, while advancements in technology can render older models less desirable. Additionally, economic conditions, shifts in consumer preferences, and increased competition can all negatively impact an asset's market value. Overall, depreciation reflects the decreasing utility and demand for the asset.