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How production flow income flow and expenditure flow in an economy are related to each other?
Production flow, income flow, and expenditure flow are interconnected components of an economy. Production flow refers to the creation of goods and services, which generates income for businesses and workers involved in the production process. This income is then spent on consumption, leading to expenditure flow, which stimulates further production. Thus, an increase in production leads to higher income, which in turn drives consumer spending, creating a continuous cycle that sustains economic activity.
WHAT ARE three major flow in the economy?
production, income and spending.
Name the three phases in the circular flow of income?
The three phases of circular flow of income are; 1.production of goods and services 2.distribution or generation of income and 3.expenditure or disposition of income
Why is wealth a flow concept?
No, it is a stock measure, as in, it is measured at a given point in time. Income on the other hand IS a flow measure, you must specify a time period for it ex. income per month or per year.
The difference between wealth and income?
The wealth ,is the money you accumulate during years . The income is the money you earn during a year . The first one is a stock the second a flow
How production flow income flow and expenditure flow in an economy are related to each other?
Production flow, income flow, and expenditure flow are interconnected components of an economy. Production flow refers to the creation of goods and services, which generates income for businesses and workers involved in the production process. This income is then spent on consumption, leading to expenditure flow, which stimulates further production. Thus, an increase in production leads to higher income, which in turn drives consumer spending, creating a continuous cycle that sustains economic activity.
Define stock and flow with example?
examples of stock variables and flow variables stock: saving,capital,labour force, wage rate, flow: income,investment,balance of payment
True or false Money is a stock while income is a flow?
True
WHAT ARE three major flow in the economy?
production, income and spending.
Name the three phases in the circular flow of income?
The three phases of circular flow of income are; 1.production of goods and services 2.distribution or generation of income and 3.expenditure or disposition of income
Why is wealth a flow concept?
No, it is a stock measure, as in, it is measured at a given point in time. Income on the other hand IS a flow measure, you must specify a time period for it ex. income per month or per year.
The difference between wealth and income?
The wealth ,is the money you accumulate during years . The income is the money you earn during a year . The first one is a stock the second a flow
Which model illustrates the continuous flow of spending production and income between the different sectors in an economy?
economic cycle
What effect does the purchase of treasury stock have on net income?
Purchase of treasury stock has no effect on the net income of a business. The purchase may affect cash flow of the business. No profit or loss is claimed when shares are re-issued at above or below cost.
Is GDP a stock or a flow?
flow
Is rate of interest a stock or flow variable?
The rate of interest is considered a stock variable. It represents the cost of borrowing or the return on investment at a specific point in time, reflecting the existing conditions in the financial market. In contrast, flow variables measure changes over a period, such as income or expenditures. Therefore, while the interest rate itself is a snapshot of financial conditions, it influences flow variables like interest payments and income generated from investments.
Is savings a flow variable?
No, savings is a stock variable. It represents the accumulation of past income that has not been spent. Flow variables, on the other hand, measure the rate at which a quantity changes over a specific time period.
