Asked by Donna Mowell on Jul 23, 2024
Verified
A firm's capital is measured as a ________ while investment in new capital is measured as a ________.
A) flow; stock
B) stock; flow
C) stock; change
D) physical amount; dollar value
Investment
The act or method of distributing resources, typically funds, with the aim of earning a return or gaining financial profit.
Capital
Financial assets or the financial value of assets, such as funds held in deposit accounts, as well as the tangible machinery and production equipment used in environments such as factories.
- Comprehend the difference between capital stock and capital flow.
Verified Answer
PM
peerapol monkthongJul 25, 2024
Final Answer :
B
Explanation :
A firm's capital is measured as a stock because it represents the total amount of resources available at a point in time. Investment in new capital is measured as a flow because it represents the rate at which the firm's capital stock is changing over time.
Learning Objectives
- Comprehend the difference between capital stock and capital flow.
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