If closing stock is less than opening stock, what will be the change in stock?
Answer and explanation
Correct answer: Negative
The change in stock is defined as closing stock minus opening stock. When closing stock is smaller than opening stock, the subtraction gives a negative value. This indicates that inventories have fallen during the period. The change would be zero only if closing and opening stocks were exactly equal.
Frequently asked questions
What is the correct answer to this question?
Negative
Why is this the correct answer?
The change in stock is defined as closing stock minus opening stock. When closing stock is smaller than opening stock, the subtraction gives a negative value. This indicates that inventories have fallen during the period. The change would be zero only if closing and opening stocks were exactly equal.
Which subject and chapter does this question cover?
This is a Class 12 Economics question. Chapter: National Income and Related Aggregates. Topic: Methods of calculating national income - Expenditure Method.
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