An Example of a Flow Variable in Economics Is

question 149

Multiple Choice

An example of a flow variable in economics is:

• A)the total amount of bank loan taken by Emily.
• B)the value of an apartment owned by Jerome.
• C)the price of an antique painting used to decorate an office.
• D)the earnings of Malaya from piano classes each month.
• E)the total value of the U.S.treasury bonds held by China.

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Definitions:

Purchases Discount

Purchases Discount represents a reduction in the price of goods a company buys, usually offered by suppliers as an incentive for early payment.

Opportunity Costs

The loss of potential gain from other alternatives when one alternative is chosen.

Carrying Costs

Expenses associated with holding inventory, including storage, insurance, and obsolescence costs, among others.

Net Present Value

Net Present Value (NPV) is a financial metric used to evaluate the profitability of an investment, calculating the difference between the present value of cash inflows and outflows over a period of time.