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Consider the following statements.
1. Flows are defined over a period of time.
2. A particular machine can be part of the capital stock only for a year
3. Stocks are defined at a particular point of time
Which of these statements are correct?
- a)1 and 2 Only
- b)2 and 3 Only
- c)1 and 3 Only
- d)All of them
Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
Consider the following statements. 1. Flows are defined over a period...
- Sometimes, when the context is familiar, we assume that the time period is known and therefore do not mention it. But inherent in all such statements is a definite period of time. Otherwise such statements are meaningless. Thus income, or output, or profits are concepts that make sense only when a time period is specified. These are called flows because they occur in a period of time. Therefore we need to delineate a time period to get a quantitative measure of these.
- Since a lot of accounting is done annually in an economy, many of these are expressed annually like annual profits or production. Flows are defined over a period of time. In contrast, capital goods or consumer durables once produced do not wear out or get consumed in a delineated time period.
- Stocks are defined at a particular point of time. However we can measure a change in stock over a specific period of time like how many machines were added this year.
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Consider the following statements. 1. Flows are defined over a period...
1. Flows are defined over a period of time:
- This statement is correct. Flows refer to the movement or transfer of goods, services, or money over a specific period. For example, the flow of income or the flow of goods in a supply chain are measured and analyzed over a given time frame.
2. A particular machine can be part of the capital stock only for a year:
- This statement is incorrect. Capital stock refers to the total value of physical assets, such as machinery, equipment, and buildings, owned by a firm or an economy at a specific point in time. A particular machine can be part of the capital stock for multiple years, as long as it remains in use and has not been replaced or disposed of.
3. Stocks are defined at a particular point of time:
- This statement is correct. Stocks refer to the quantity or value of assets, liabilities, or other economic variables at a specific point in time. Stocks are measured at a particular moment and provide a snapshot of the situation at that specific time, such as the inventory of goods on a particular day or the amount of money in a bank account at a specific point.
Therefore, the correct statements are 1 and 3 only (a). Flows are defined over a period of time, while stocks are defined at a particular point in time. The second statement is incorrect as a particular machine can be part of the capital stock for more than just a year.
- This statement is correct. Flows refer to the movement or transfer of goods, services, or money over a specific period. For example, the flow of income or the flow of goods in a supply chain are measured and analyzed over a given time frame.
2. A particular machine can be part of the capital stock only for a year:
- This statement is incorrect. Capital stock refers to the total value of physical assets, such as machinery, equipment, and buildings, owned by a firm or an economy at a specific point in time. A particular machine can be part of the capital stock for multiple years, as long as it remains in use and has not been replaced or disposed of.
3. Stocks are defined at a particular point of time:
- This statement is correct. Stocks refer to the quantity or value of assets, liabilities, or other economic variables at a specific point in time. Stocks are measured at a particular moment and provide a snapshot of the situation at that specific time, such as the inventory of goods on a particular day or the amount of money in a bank account at a specific point.
Therefore, the correct statements are 1 and 3 only (a). Flows are defined over a period of time, while stocks are defined at a particular point in time. The second statement is incorrect as a particular machine can be part of the capital stock for more than just a year.
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Consider the following statements. 1. Flows are defined over a period of time.2. A particular machine can be part of the capital stock only for a year3. Stocks are defined at a particular point of timeWhich of these statements are correct?a) 1 and 2 Onlyb) 2 and 3 Onlyc) 1 and 3 Onlyd) All of themCorrect answer is option 'C'. Can you explain this answer?
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Consider the following statements. 1. Flows are defined over a period of time.2. A particular machine can be part of the capital stock only for a year3. Stocks are defined at a particular point of timeWhich of these statements are correct?a) 1 and 2 Onlyb) 2 and 3 Onlyc) 1 and 3 Onlyd) All of themCorrect answer is option 'C'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following statements. 1. Flows are defined over a period of time.2. A particular machine can be part of the capital stock only for a year3. Stocks are defined at a particular point of timeWhich of these statements are correct?a) 1 and 2 Onlyb) 2 and 3 Onlyc) 1 and 3 Onlyd) All of themCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements. 1. Flows are defined over a period of time.2. A particular machine can be part of the capital stock only for a year3. Stocks are defined at a particular point of timeWhich of these statements are correct?a) 1 and 2 Onlyb) 2 and 3 Onlyc) 1 and 3 Onlyd) All of themCorrect answer is option 'C'. Can you explain this answer?.
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