Distinguish between stock and flow. Between net investment and capital which is a stock and which is a flow?
| Stock | Flow |
| Stock relates to a point of time | Flow relates to a period of time. |
| Stock is not time dimensional. | Flow is time dimensional as per hour, per month, per year. |
| Stock influences the flow. Greater the glow of capital, greater is the flow of goods and services. | Flow influences the stock. For example: monthly increase in the supply of money leads to an increase in the quantity of money. |
| Example: Wealth, capital, etc. | Example: Income, capital formation. |
Between net investment and capital, capital is a stock since it is measured over a point of time and net investment is a flow since it is measured over a specified period of time.