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Which of the following is a flow variable rather than a stock variable?
AMoney supply
BForex reserves
CNational income
DCapital stock
Answer & Solution
Correct answer: C. National income
1. A stock is a quantity of a commodity measured at a point of time, described in the glossary as static.
2. A flow is measured over a period of time, described as dynamic.
3. Money supply, unemployment level, foreign exchange reserves and capital are given as examples of stock variables.
4. National income, imports, exports, consumption, production and investment are given as flow variables, so national income is the answer.
5. Note that capital is a stock while investment is a flow, which is the pairing students most often reverse.
_Source: TN HSC Class 12 Economics (Samacheer Kalvi, Govt of Tamil Nadu), Ch 1 "Introduction to Macro Economics", §1.8.1_
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