Question

What are the variables which are defined at a particular point of time called?

• A. Stock variables
• B. Flow variables
• C. Constant variables
• D. None of these

Hint:

Stock variables are measured at a specific point in time, while flow variables are measured over a period of time.

Answer 1

The Correct Option is A

Step 1: Understanding stock and flow variables.
In economics, variables can be classified into two categories: stock variables and flow variables. Stock variables are defined at a particular point in time, representing a quantity that exists at that point. For example, wealth, capital, and inventory are stock variables. Flow variables, on the other hand, are measured over a period of time, such as income or expenditure.

Step 2: Analyzing the options.
(A) Stock variables: Correct. Stock variables are defined at a specific point in time. Examples include wealth, capital, and debt.
(B) Flow variables: This is incorrect. Flow variables are measured over a period of time, not at a specific point.
(C) Constant variables: This is incorrect. Constant variables remain unchanged but are not specifically related to being defined at a particular point in time.
(D) None of these: This is incorrect because the correct answer is (A).

Step 3: Conclusion.
Variables defined at a particular point of time are called stock variables. Therefore, the correct answer is (A) Stock variables.