Which term describes the time an asset can be expected to retain value before becoming worthless?

• A. Useful life
• B. Predicted economic life
• C. Salvage life
• D. Depreciation life

Answer: (B)

In asset planning, the period an asset is expected to retain value and generate economic benefits is its economic life. The phrase “predicted economic life” communicates the estimated span during which the asset will still be economically productive before it becomes worthless. This is the best fit because it focuses on the value and benefits the asset delivers over time, not just how long it can physically operate.

Useful life is about the ability to perform its function, which isn’t the same as the value it retains. Salvage value refers to the monetary worth you might recover at the end, not the time period of value retention. Depreciation life isn’t a standard term here; depreciation is typically tied to the asset’s useful or economic life for cost allocation.