If there are more inflows than outflows, the level of stock will increase. If there are more outflows than inflows, the level of stock will decrease. If the amount of outflows and inflows is equal, the stock level will remain at its current level and will be unchanged (this is called dynamic equilibrium). The level of a stock is increased if its outflow is decreased or its inflow is increased. Stocks provide a sort of security barrier in a system, since they serve to delay the initial shock that may affect a system. Stocks preserve the ability of inflows and outflows to remain
...more
