what is a stock (S) or a flow (F).
A stock refers to a quantity or amount that is measured at a specific point in time. It represents a static or accumulated value. Examples of stocks include inventory levels, bank balance, or outstanding debt.
A flow, on the other hand, refers to a rate at which a quantity changes over time. It represents the movement or transfer of something. Flows can be measured per unit of time, such as a flow rate. Examples of flows include sales revenue, income, or the number of products produced per hour.
In the context of economics, a stock (S) refers to a quantity of something that exists at a particular point in time, while a flow (F) refers to the rate at which that something is changing per unit of time.
To simplify, let's consider an example: money. If you have $100 in your bank account right now, that $100 is a stock because it represents a certain quantity of money at a specific point in time. On the other hand, if you receive a monthly salary of $1,000, the salary would be considered a flow because it represents the rate at which your money increases per month.
The key difference between stocks and flows is that stocks are measured at a specific moment in time, while flows are measured over a period of time. Stocks can change when flows are added or subtracted from them.