What Is the Difference Between a Flow Variable and a Stock

question 76

Multiple Choice

What is the difference between a flow variable and a stock variable?

• A) A stock variable is a variable that is measured over a specific period of time while a flow variable is a variable that is independent of time.
• B) A flow variable is a variable that is measured in units of current prices while a stock variable is measured using prices from a base period.
• C) A flow variable is a variable that is measured over a specific period of time while a stock variable is a variable that is independent of time.
• D) A stock variable is a variable that is measured in units of current prices while a flow variable is measured using prices from a base period.

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Definitions:

Inventory Shrinkage

The loss of products between purchase from suppliers and sale to customers, often due to theft, damage, or clerical errors.

Operating Expense

Costs associated with the day-to-day operation of a business, including rent, utilities, and salaries.

Physical Count

The process of counting the actual inventory on hand to ensure accuracy in inventory records.

Gross Margin

Gross Margin is a company's revenue from sales minus its cost of goods sold, indicating the efficiency of its production process and pricing strategy.