---
entity_slug: revenue
evaluator: null
evaluated_at: '2026-02-23T06:19:08.902783'
overall_score: 4.0
scores:
- name: definition_precision
  value: 4.0
  max_value: 5.0
  rationale: The definition clearly distinguishes revenue as income from capital stock,
    specifying both circulating goods and fixed capital sources. It avoids circularity
    by grounding the concept in the employment of stock as capital rather than simply
    defining revenue as "income."
- name: source_grounding
  value: 5.0
  max_value: 5.0
  rationale: This entity is directly grounded in Book II, Chapter 1 of The Wealth
    of Nations, where Smith explicitly discusses the distinction between stock reserved
    for consumption and stock employed as capital to generate revenue. The definition
    accurately reflects Smith's conceptual framework.
- name: domain_placement
  value: 4.0
  max_value: 5.0
  rationale: Placement in "Distribution" is appropriate since revenue represents how
    returns from capital are allocated and distributed within the economic system.
    However, it could arguably also fit in a "Production" domain given its connection
    to productive capital employment.
- name: vsm_relevance
  value: 3.0
  max_value: 5.0
  rationale: Revenue maps most naturally to S1 (primary operations) as it represents
    the direct output/return from productive activities, but it also has relevance
    to S3 (internal regulation) for monitoring capital performance. The mapping is
    reasonable but not uniquely clear to one system.
- name: explanatory_value
  value: 4.0
  max_value: 5.0
  rationale: This entity provides genuine explanatory power by illuminating the mechanism
    through which capital generates returns and sustains economic activity. It helps
    explain the structural relationship between capital employment and wealth accumulation
    rather than merely naming a surface phenomenon.
---

# Evaluation: Revenue

## definition_precision — 4.0 / 5.0

The definition clearly distinguishes revenue as income from capital stock, specifying both circulating goods and fixed capital sources. It avoids circularity by grounding the concept in the employment of stock as capital rather than simply defining revenue as "income."

## source_grounding — 5.0 / 5.0

This entity is directly grounded in Book II, Chapter 1 of The Wealth of Nations, where Smith explicitly discusses the distinction between stock reserved for consumption and stock employed as capital to generate revenue. The definition accurately reflects Smith's conceptual framework.

## domain_placement — 4.0 / 5.0

Placement in "Distribution" is appropriate since revenue represents how returns from capital are allocated and distributed within the economic system. However, it could arguably also fit in a "Production" domain given its connection to productive capital employment.

## vsm_relevance — 3.0 / 5.0

Revenue maps most naturally to S1 (primary operations) as it represents the direct output/return from productive activities, but it also has relevance to S3 (internal regulation) for monitoring capital performance. The mapping is reasonable but not uniquely clear to one system.

## explanatory_value — 4.0 / 5.0

This entity provides genuine explanatory power by illuminating the mechanism through which capital generates returns and sustains economic activity. It helps explain the structural relationship between capital employment and wealth accumulation rather than merely naming a surface phenomenon.
