Consumable is a general term for single use or charge use consumable items like Fire Protection Potions produced by Alchemy, stamina buffing food like Tender Wolf Steak, or rogue energy boosters like Thistle Tea. Generally, consumables can greatly buff a players performance, but usually the components are hard to find and expensive. Particularly Flasks can be very hard on the wallet. The more expensive consumables are normally used only in raids, but there they are sometimes chain-quaffed. Players not properly buffing themselves in raids are usually frowned upon and sometimes even kicked.
Some items are both consumable or not, depending on how you choose to use them:
These can be used as jewelry for their stats, and if you can't afford to replace them, you simply do not use them up.