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Flow

A flow variable is measured over an interval of time. For example, UK nominal GDP refers to the total number of pounds spent over a time period, such as a year. Therefore it is a flow variable, and has units of pounds/year.

Below highlights the idea of a flow in contrast to a stock. This shows that Real GDP is continually changing and this then gets added to the stock of real GDP to measure the size of an economy. In this instance the cumulative real GDP exceeds the current value of real GDP.

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