Asked by Willie Alfaro Mora on Jun 28, 2024
Verified
Which of the following is correct?
A) Income is a stock concept, and wealth is a flow concept.
B) Both income and wealth are flow concepts.
C) Both income and wealth are stock concepts.
D) Income is a flow concept, and wealth is a stock concept.
Stock Concept
A financial term referring to the ownership of shares in a company or the total value of goods available in inventory.
Flow Concept
Economic measures that are defined over a period of time, such as income or expenditure, contrasted with stock concepts measured at a point in time.
Wealth
The accumulation of valuable financial assets and physical possessions which can be used to produce more income or sold for monetary value.
- Differentiate the principles of income versus wealth, along with their allocation.
Verified Answer
AK
Ambika KandelJul 05, 2024
Final Answer :
D
Explanation :
Income is a flow concept because it refers to the amount of money received over a period of time, while wealth is a stock concept because it refers to the accumulation of valuable resources or assets at a given point in time.
Learning Objectives
- Differentiate the principles of income versus wealth, along with their allocation.