Question

What is Stock and Flow Concept?

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Answer 1

Answer:

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Thus, a stock refers to the value of an asset at a balance date (or point in time), while a flow refers to the total value of transactions (sales or purchases, incomes or expenditures) during an accounting period. ... Capital is a stock concept which yields a periodic income which is a flow concept.

Explanation:

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Answer 2

Answer:

A Stock Concept

1. Stock is defined as a variable that is measured at a particular point in time

2. Stock does not have a time dimension attached with it

3. Stock is static in nature

4. Stock influences the flow, as such greater amount of capital will lead to greater flow of services

5. Bank deposits, capital, wealth, population

A Flow Concept

1. Flow is defined as a variable which is measurable over a period of time

2. Flow has a time dimension attached with it

3. Flow is dynamic in nature

4. Flow influences the stock, as in increased flow of money supply in an economy results in increase in the quantity of money

5. Capital formation, income, interest on capital, depreciation