What is economic life?

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Study for the McKissock Basic Appraisal Principles Test. Utilize flashcards and multiple choice questions, each enriched with hints and explanations, to master the key concepts of the appraisal process and prepare effectively for your exam!

Multiple Choice

What is economic life?

Explanation:
Economic life is the period during which a property remains economically productive and valuable. It ends when continuing to use or maintain the improvement no longer yields benefits because demand, technology, or market conditions have changed, making the asset uneconomical to operate. This concept focuses on value and profitability, not on how long the building physically stands. It differs from the total physical life, which is about physical durability, and from legal life, which relates to ownership rights.

Economic life is the period during which a property remains economically productive and valuable. It ends when continuing to use or maintain the improvement no longer yields benefits because demand, technology, or market conditions have changed, making the asset uneconomical to operate. This concept focuses on value and profitability, not on how long the building physically stands. It differs from the total physical life, which is about physical durability, and from legal life, which relates to ownership rights.

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