Question

Define income. Stock or flow?

Answer 1

Income is the amount recives in monetary terms by an individual for provicing either goods or services. It is the money earned by a person for his work done.

Stock variables are ones that are measured at a point of time. Examples of stock variables are, wealth that a person holds (wealth will be the same if measured at any point of time), loans, population etc.

On the other hand, a flow variable is measured over a period of time. Examples of flow variables are, income of the consumer (it is measured over a period of time like income earned in a week, month or year), national income, savings, expenditure ect.

Since income is measured over a period of time, it is considered as a flwo variable.