A method of calculating the depreciation of a wasting asset based on the rate at which it is being used. For example, a coal mine could be depreciated on the basis of the rate at which coal is extracted from it.
In appraisal terminology, the recapture rate is the rate of recovery of an investment in a wasting asset. This rate is added to the discount rate to derive a capitalization rate.
A payment made for the right to use the property of another person for gain, often involving intellectual property or natural resources.
A wasting asset is an asset that has a finite life span and steadily declines in value over time, typically due to physical wear and tear or obsolescence.
