Property Valuation

Depreciation in the cost approach to value includes all of the following EXCEPT:

APhysical deterioration
BFunctional obsolescence
CExternal obsolescence
DMarket appreciation✓ Correct

Explanation

The three categories of depreciation in the cost approach are physical deterioration, functional obsolescence, and external (economic) obsolescence. Market appreciation is the opposite of depreciation and is not a form of depreciation.

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