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Distinguish Between Stock and Flows. Give an Example of Each. - CBSE (Arts) Class 12 - Economics

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Question

Distinguish between stock and flows. Give an example of each.

Solution

Stock Flow
A stock is a variable which is measured at a particular time. Flow is a variable which is measured over a long period of time
A stock is stat Flow is dynamic
The time dimension is not applied to
the stock concept.
The time dimension is applied to the
flow concept
Examples: National wealth and
bank deposits
Examples: National income and
interest on capital

In a tank of water, the flow of water can be considered a flow variable and the stock of water can be considered a stock variable because it can be measured at a particular point of time. Capital is like the stock of water in the tank at a particular point of time, whereas net investment is like the flow of water into the tank.

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Solution Distinguish Between Stock and Flows. Give an Example of Each. Concept: Basic Concepts - Stocks and Flows.
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