ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Wealth measures the value of all the assets of worth owned by a person, community, company, or country. Wealth is determined by taking the total market value of all physical and intangible assets owned, then subtracting all debts. Essentially, wealth is the accumulation of scarce resources.

Detailed explanation-2: -Wealth can be defined as a family’s assets minus their liabilities. Your assets can include the money you have in your savings and checking accounts, your retirement savings or the home and/or car you own. Your liabilities are your debts, including a mortgage, car note, credit card balance and/or student loan debt.

Detailed explanation-3: -An asset is anything you own that adds financial value, as opposed to a liability, which is money you owe. Examples of personal assets include: Your home. Other property, such as a rental house or commercial property.

Detailed explanation-4: -Wealth can be categorized into three principal categories: personal property, including homes or automobiles; monetary savings, such as the accumulation of past income; and the capital wealth of income producing assets, including real estate, stocks, bonds, and businesses.

Detailed explanation-5: -Assets Create Income An investment in an apartment house stores wealth and creates rental income, for example. An investment in a share of stock stores wealth and also perhaps creates dividend income. A deposit in a savings account stores wealth and creates interest income.