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A depreciation refers to the decrease in the worth or significance of a property, or the responsibility for any legal obligations. It is a common term used in the realm of finance and accounting to describe the decline in the value of an asset over time. This can occur due to various factors, such as wear and tear, technological advancements, or changes in market conditions. As a knowledgeable professor, it is important to understand the concept of depreciation and its impact on financial statements. Let's dive into this topic further to gain a deeper understanding.
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