CUET Preparation Today
Which of the following can be classified as a "Flow" variable? |
Loss by a firm Bank deposits as on 1st oct 2017 Value Added Both 1 and 3 |
Both 1 and 3 |
The correct answer is Option 4: Both 1 and 3 Stock variables are those variables which are measured at a particular POINT of time whereas, flow variables are those variables which are measured over a PERIOD of time. Losses incurred by a firm is measured over a PERIOD of time thus considered as a "Flow variable". Bank deposits as on 1st oct 2017, Money supply etc are measured on a POINT of time thus, will be considered as a stock variable. The net contribution made by a firm is called its value added. The value added of a firm is, value of production of the firm – value of intermediate goods used by the firm. The value added of a firm is distributed among its four factors of production, namely, labour, capital, entrepreneurship and land. Therefore wages, interest, profits and rents paid out by the firm must add up to the value added of the firm. Value added is a flow variable. |
