Lecture03_Distinctions among Money, Wealth, and Income (part 2 of this lecture)

[K@sh Again]

 While Money,Wealth, and Income are all measured in some currency unit, they differ significantly in their meaning. Well here I am going to explain these terms a little bit after reading my complete post you will be able to differ these three things from each other.

Money:
 People have money if they have a large amount of currency or have a big  bank accounts  at a point in time. (bank accounts are stock variable OK.)

Stock variable is normally taken as an asset, we said earlier that money is an asset which is used by us as making payments for goods and services & repayment of debts.

Income:
 Someone earns income from work or investment over a period of time. (flow variable.)
Income basically is a flow variable because earning income by working generate certain flow for the time period during which we are working so income basically becomes a flow variable.
   On the other hand, another source of income can be that someone made investments, and because of those investments you earn interest that is also called flow variable.

Wealth:
People have wealth if they have assets that can be converted into more currency than is necessary to pay their debts at a point in time. (stock variable.)

 Note: You may see this concept of money in your handouts of MGT411, page number 8, lecture 03. now you may read the text under heading "Distinctions among Money, Wealth, and Income" and after reading my full mail and reading that paragraph, if you will have still some questions in your mind about this topic then don't be shy to ask questions to me, I am here to explain you again and again.