Which term describes growth in value of an asset over time?

Study for the Bachelor of Business and Economics (BBE) Entrance test. Focus on Math with flashcards and multiple choice questions, each accompanied by hints and explanations. Prepare effectively for your exam!

Multiple Choice

Which term describes growth in value of an asset over time?

Explanation:
Growth in value of an asset over time is called appreciation. This term describes when an asset becomes more valuable, such as a property or stock price rising from one value to a higher value due to demand, improvements, or market conditions. For instance, if a property goes from 100,000 to 120,000, that’s appreciation of 20,000 (a 20% increase). The other words don’t fit this idea: mean is simply an average value, impatient isn’t a finance term, and adverse means harmful or unfavorable, not an increase in value.

Growth in value of an asset over time is called appreciation. This term describes when an asset becomes more valuable, such as a property or stock price rising from one value to a higher value due to demand, improvements, or market conditions. For instance, if a property goes from 100,000 to 120,000, that’s appreciation of 20,000 (a 20% increase). The other words don’t fit this idea: mean is simply an average value, impatient isn’t a finance term, and adverse means harmful or unfavorable, not an increase in value.

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