# Current magnitude

Under a stream size (also moving amount , flow amount ; English flow ) is understood in the Wirtschaftsmathematik within a given period of time in monetary units Reviewed or in physical units measured size . The contrast is the size of the stock .

## General

The economist Nicholas Gregory Mankiw has explained the difference and connection between stock and flow variables using the bathtub as an example . The amount of water present in the tub is the stock quantity , the water flowing into or out of the tub is a flow quantity. This also results in the relationship between the two sizes, because inflow and outflow change the stock size.

The flow variable differs from the stock size in the temporal delimitation of an examined population , with flow variables referring to a limited period (for example the number of bankruptcies in 2010 as a whole). In contrast, the size of the population is based on a specific point in time (e.g. the number of inhabitants of Cologne as of December 31, 2016). The indication of the period for which the flow rate is to be determined is mandatory, because there is a big difference , for example, between the monthly income and the annual income of a private household .

Flow quantities are less likely to be random than stock quantities. The stock sizes determined at a certain point in time can be influenced by events that occur up to the key date . This random probability decreases for flow variables the larger the survey period is chosen.

## detection

The numerical value of a flow quantity can be a monetary unit (such as euros ) or a physical quantity ( kilograms ), from which the dimension "monetary or quantity units per period" results. Mathematically, currents contain a member of the dimension class “time” in their dimension with an exponent other than zero . Stock sizes, on the other hand, do not contain any time dimensions in their dimension. In an electricity quantity calculation, the scope and structure of economic quantities are recorded with the dimension “euros per period”. For flow quantities, the summation is used as an aggregation function.

Each flow variable changes its associated stock size. Receipts increase inventory, consumption or issues reduce it. If, for example, a part of the income (flow rate) of a private household is saved , its wealth increases or its debts decrease (stock size). The size of the currency reserve changes due to constant inflows and outflows of foreign currency .

## species

In economics and business administration, there are the following flows, among others:

These flow quantities are at the same time economic or business indicators .

The basic terms of accounting ( payment / payment , income / expenditure , expense / income ) relate to asset flows and are therefore flow variables.

## Flow quantities in the annual financial statements

In the financial statements of companies both inventory are included as flows. The balance sheet consists of inventory values ​​that are determined on the balance sheet date (usually December 31 ), the income statement contains the cumulative success figures ( sales , costs or income ) for an entire financial year as flow parameters .

For example, the EBIT can be determined from the compilation of various flow variables :

```    Umsatzerlös
+/- Bestandsveränderungen
+ aktivierte Eigenleistungen
- Materialaufwand
- Personalaufwand
- sonstige betriebliche Aufwendungen
+ sonstige betriebliche Erträge
- Abschreibungen auf das Anlagevermögen
+ Zuschreibungen zum Anlagevermögen
= EBIT
```

The determination of the EBIT is a business flow calculation as in the cash flow calculation , while economics knows the national accounts as flow calculation.

## Linking flow and stock quantities

In the balance sheet analysis , it is also possible to combine key figures from inventory and flow variables, such as the inventory turnover rate or the debtor target . The inventory turnover rate results from the ratio of the material costs (flow rate) and the inventory (inventory size). Statistical turnover ratios always relate a stock size to the changing flow size. In economics the associated capital productivity , the production amount (current value) and the requisite capital stock (stock size).

Macroeconomic models that depict changes in stocks and flow sizes are called stock-flow consistent models .

## Individual evidence

1. N. Gregory Mankiw, Macroeconomics , 2011, p. 26
2. Benjamin Auer / Horst Rottmann, Statistics and Econometrics for Economists , 2015, p. 5
3. Michael Frenkel / Klaus Dieter John / Ralf Fendel, National Economic Accounts , 2016, p. 7
4. Jürgen Kopf, Elements of Economic Research and Teaching: Festschrift for Sigurd Klatt on his 65th birthday , 1993, p. 19
5. Volker Letzner, Test and Training Math, Logic and Statistics , 2007, p. 28
6. Jay Wright Forrester , Industrial Dynamics , 1961, p. 69
7. Michael Frenkel / Klaus Dieter John / Ralf Fendel, National Accounts , 2016, p. 8
8. Ullrich Guckelsberger / Fritz Unger, Statistics in Business Administration , 1999, p. 14
9. Heinz J. Aubeck, Accounting for Schools and Training , 2017, p. 364