Final answer:
Depreciation applies to assets with a finite useful life and is relevant to managing tangible assets within investment strategies and financial assets. Collectibles provide different kinds of returns and are not typically relied upon for consistent long-term gains.
Step-by-step explanation:
Depreciation is used for assets that have a finite useful life—that is, assets that will not be useful indefinitely but will degrade or become obsolete over time. This concept is tied to investment strategies and the management of financial assets.
For example, a company may invest in machinery that has a lifespan of 10 years, or in constructing a facility projected to last 30 years. These tangible assets are different from collectibles like paintings, fine wine, or jewelry, which may provide a return through enjoyment or potential sale for a higher price in the future. However, unlike standardized assets, collectibles should not be relied upon for consistent, high returns over a long period.