Родион С.К., Савинова А.И. Английский язык Изучаем основы экономики

МИНИСТЕРСТВО ОБРАЗОВАНИЯ РЕСПУБЛИКИ БЕЛАРУСЬ
УО «Белорусский государственный экономический университет»
С.К. Родион, А.И. Савинова
ENGLISH: FIRST INSIGHTS INTO
ECONOMICS
АНГЛИЙСКИЙ ЯЗЫК:
ИЗУЧАЕМ ОСНОВЫ ЭКОНОМИКИ
Электронное учебно-методическое издание
по дисциплине «Иностранный язык (английский)»
для студентов заочной формы обучения
Минск 2012
Рецензент: старший преподаватель кафедры теории и практики
английской речи БГЭУ Левченко Л.П.
Рекомендовано кафедрой теории и практики английской речи БГЭУ.
Родион, С.К., Савинова, А.И.
Английский язык: Изучаем основы экономики = English: First Insights into
Economics: учебно-методическое пособие (ЭУМИ) / С.К. Родион,
А.И. Савинова. – Минск: БГЭУ, 2012. – 95 с. (4 усл. печ. л.)
Учебно-методическое пособие содержит учебный материал по развитию
навыков профессионально ориентированного чтения, устной речи и письма на
английском языке в рамках тематики, связанной с основными положениями
экономической теории.
Предназначено для студентов экономических специальностей заочной
формы обучения.
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CONTENTS
Предисловие ……………………………………………………………… 4
Unit1. Economics as a Science …………………………………………… 5
Unit 2. Microeconomics and Macroeconomics …………………………… 10
Unit 3. Types of Economic Systems ……………………………………… 15
Unit 4. Scarcity and Choice ……………………………………………… 20
Unit 5. Demand and Supply ……………………………………………… 24
Unit 6. Opportunity Cost ………………………………………….............. 29
Unit 7. Money ………………………………………………………….
34
Unit 8. Markets and Prices ………………………………………………… 39
Unit 9. Factors of Production ……………………………………………… 44
Unit 10. Forms of Business ……………………………………………… 49
Unit 11. Government and Business ……………………………………… 54
Unit 12. Corporate Culture ………………………………………………… 59
Unit 13. Employment ……………………………………………………… 65
Unit 14. Globalization …………………………………………………… 71
Unit 15. The First Modern Economists …………………………………… 76
Supplementary Reading ……………………………………………............. 81
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ПРЕДИСЛОВИЕ
Данное учебно-методическое пособие предназначено для студентов
экономических специальностей заочной формы обучения и может быть
использовано как для работы в аудитории, так и для самостоятельной
внеаудиторной работы.
Целью пособия является развитие навыков чтения текстов экономической
тематики, развитие и совершенствование навыков устного высказывания,
умений выражать собственное мнение, а также формирование навыков
реферирования на английском и русском языках.
Все 15 разделов учебного пособия имеют одинаковую структуру и
включают следующие блоки: Lead-in (введение), Key Vocabulary (базовая
лексика), Pre-reading Activities (предтекстовые упражнения), Reading (тексты
для чтения), Comprehension Check (упражнения на понимание текста),
Vocabulary Focus (лексические упражнения), Talking Points (коммуникативные
упражнения), Summary Points (упражнения на реферирование).
При подборе тематики текстов и определении их объёма авторы
учитывали специфику обучения студентов-заочников в вузе экономического
профиля, а также актуальность активизации самостоятельной работы студентов
в связи с увеличением времени, отводимого на самостоятельную работу
Текстовый материал, пред- и послетекстовые упражнения направлены на
развитие как навыков чтения, так и речевых навыков студентов-заочников
экономических специальностей путём обучения пониманию и осмыслению
прочитанного текста, активизации словарного запаса и речевых структур в
процессе работы над текстом.
Задания в блоке Talking Points носят преимущественно творческий
характер и направлены на совершенствование коммуникативных навыков, а
также умения формулировать собственное мнение на английском языке.
Особое внимание уделяется умению выражать свою точку зрения через
согласие/несогласие, а также аргументированно доказывать или опровергать
предложенное утверждение.
Целью заданий блока Summary Points является формирование одной из
важнейших компетенций студента университета – умения выполнять
реферирование текстов.
Раздел Supplementary Reading включает в себя набор текстов, дающих
дополнительную информацию к текстам основных разделов, которые могут
быть использованы для развития как навыков чтения, так и речевых навыков, а
также могут служить материалом для обучения студентов реферированию.
4
Unit 1
ECONOMICS AS A SCIENCE
Lead- in
Discuss the following issues in small groups and then report your findings.
1. Is economics a science? Prove it.
2. Should people of different professions know the basics of economics? What
makes you think so?
3. Why have you decided to enter the Economic University and study
economics on the professional level?
Key Vocabulary
Study the following list of vocabulary.
1. originate v
происходить; возникать, появляться
2. household management
ведение домашнего хозяйства
3. outline v
изложить; обрисовать, наметить в
общих чертах
4. deal with smth
иметь дело с чем-л.
5. production n
производство
6. distribution n
распределение
7. consumption n
потребление
8. consume v
потреблять
9. allocate v
размещать, распределять
10. scarcity n
недостаток, нехватка, дефицит
11.scarce adj
недостаточный, дефицитный
12. goods and services
товары и услуги
13. resources n
ресурсы; средства
14. meet needs
удовлетворять потребности
15. available adj
доступный, имеющийся в наличии
16. equipment n
оборудование; оснащение
17. improve well-being
улучшать благосостояние
18. gain satisfaction
получать удовлетворение
19. consider v
рассматривать, обсуждать, обдумывать
20. aggregate outcome
совокупный результат
21. enterprise n
предприятие
22. make a decision
принимать решение
23. make a choice
сделать выбор
24. make efforts
прилагать усилия
25. machinery n
машинное оборудование
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Pre-reading Activities
1. Study the different meanings of the following words.
1. economy n – экономика, народное хозяйство, экономия
2. economics n – экономика, экономическая теория, экономическая наука
3. microeconomics n – микроэкономика (анализирует взаимоотношения
между отдельными хозяйственными единицами)
4. macroeconomics n – макроэкономика (анализирует экономику в целом, в
том числе денежную массу, безработицу)
5. economist n – экономист
6. economic adj – экономический, относящийся к сфере экономики
7. economical adj – экономный, экономичный, бережливый
8. economize v – экономить
2. Complete the following sentences with the appropriate word from exercise 1.
1. If you can ………. your time, you will manage to do a lot of things.
2. This country is in the period of ………. and financial crisis.
3. My car is more ………. than yours and it uses less petrol.
4. ………. is my favourite subject at the University.
5. Manufacturing has always been a significant part of the British ………. .
6. My father graduated from the ………. University and he works as an
………. .
Reading
Read the text and find out what economics is.
The term «economics» originated from the Greek word «oikonomika» which
means household management. It became a separate field of study with the
publication of Adam Smith’s «The Inquiry into the Nature and Causes of the Wealth
of Nations» in 1776 in Scotland. Adam Smith is considered to be the founder of
economics because he was the first economist to outline the activity of a free market
economy.
By definition, economics is the science that deals with production, distribution
and consumption of goods and services. It is the study of how human beings allocate
scarce resources to satisfy their unlimited wants. Different societies face with the
problem of scarcity, that is why it is important to study the way resources are
distributed to meet the needs of the greatest number of people.
But what do resources include? They include the time and talent people have
available, land, buildings, equipment and knowledge. By the way, people’s
knowledge helps them to combine all the available resources to create useful products
and services. Economists emphasize that people use resources to improve their wellbeing and gain satisfaction from products and services they choose to consume.
There are two major subdivisions of economics: microeconomics and
macroeconomics. Microeconomics is the study of how the system affects an
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enterprise and it considers how individuals make decisions. Macroeconomics is the
study of the entire system of economics and it considers aggregate outcomes.
In general, economics is involved in all spheres of people’s activity. It
examines how we make choices among alternatives and gives us a logical way of
understanding how to make the best use of natural resources, machinery and people’s
work efforts.
Comprehension Check
1. Agree or disagree with these statements about the text.
1. John Maynard Keynes is considered to be the founder of economics.
2. Economics is the science that deals with production, distribution and
consumption of goods and services.
3. People use resources to gain profit.
4. There are four major subdivisions of economics.
5. Economics is involved almost in all spheres of people’s activity.
2. Choose the answer (A, B or C) which you think fits best according to the text.
1. According to the first paragraph, what is the origin of the term «economics»?
A. it originated from the Latin word «oikonomika» which means household
management.
B. it originated from the Greek word «oikonomika» which means household
management.
C. it originated from the Greek word «oikonomika» which means effective use
of resources.
2. What do resources include?
A. the time and talent people have available; land, buildings, equipment and
knowledge.
B. the time people have available; computers and knowledge.
C. the talent people have available; land, equipment and money.
3. What are the major subdivisions of economics?
A. economy and scarcity
B. resources and profit
C. microeconomics and macroeconomics
3. Complete the sentences using the information from the text.
1. Economics became a separate field of study ………
2. People’s knowledge helps them ………
3. Macroeconomics is the study ………
4. Microeconomics is the study ………
5. Economics examines how we …..
Vocabulary Focus
Use the words from the list of Useful Vocabulary to complete the sentences.
7
1. The development of national ….. is based on certain laws and principles.
a. economize
b. economy
c. economics
2. The increase in the ….. of goods is always limited by the budget constraints.
a. consumption
b. efficiency
c. reliability
3. Economists ….. forces of demand and supply to determine the prices of
goods and services.
a. ignore
b. consider
c. improve
4. One of the urgent tasks of the Government is to ….. people’s well-being.
a. improve
b. manage
c. analyze
5. The management of the company is expected to ….. effectively and quickly.
a. fire the staff
b. make decisions
c. improve well-being
2. Give the synonyms to the following words and word combinations. Mind the
list of Useful Vocabulary.
manufacturing
using
company
to satisfy wants
to try
3. Give the English equivalents to the following expressions.
производство товаров и услуг
распределять доступные ресурсы
улучшать благосостояние
получать удовлетворение
совокупный результат
сферы деятельности
выбирать из альтернатив
сталкиваться с проблемой
размещать недостающие ресурсы
проблема нехватки, дефицита
Talking Points
1. Explain in your own words how you understand the problem of scarcity.
8
2. Comment on the quotation
“Economics is the study of people in the ordinary business of life” (Alfred
Marshall)
Prove that the subject of economics is interesting to you. Use the following
expressions in your answers.
- I really enjoy economics because ………
- I’m quite interested in economics because ………
- I would like to know more about economics because ………
- I think economics is interesting for studying because ………
Summary Points
1. Study the guidelines to summarizing.
Реферирование (англ. summary) – это сжатое изложение основной
информации первоисточника на основе её смысловой переработки. Как
правило, реферат состоит из трёх основных частей: введение, основная часть,
заключение и соответствует следующим требованиям:
1. Реферат представляет собой краткое изложение основного содержания
текста, статьи и т.д. и составляет примерно 1/3 оригинала.
2. Предпочтительно при реферировании излагать информацию своими
собственными словами.
3. Вводная часть реферата включает в себя заглавие оригинала, его
главную тему и идею.
2. Look through the text from Reading and define its topic and main idea, using
the following phrases.
The basic topic is ………
Основная тема ………
The subject (subject matter) of the text
is
The main idea is that ………
Основная идея заключается в том, что
………
The text (passage) discusses (considers, В тексте (отрывке) обсуждается
focuses on, addresses) the problem of (рассматривается,
сосредоточивается
………
внимание на…) проблема(е) ………
The text (passage) deals with ………
В тексте (отрывке) говорится о ………
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UNIT 2
MICROECONOMICS AND MACROECONOMICS
Lead-in
1.
Do you know what the difference is between macroeconomics and
microeconomics?
2.
Are the following statements about microeconomics or
macroeconomics?

… deals with topics of inflation and unemployment.

… studies how people make decisions to allocate limited resources.

In … the focus is placed on factors that affect the decisions made by
firms and individuals.

... includes a national, regional, or global economy.
Key Vocabulary
Study the following vocabulary and do the tasks that follow.
1. allocation n
2. distribute v
3. divide v
4. behaviour n
5. affect v
6. make a profit
7. study v
8. entire adj
9. unemployment n
10. income n
11. rate of growth
12. gross domestic product (GDP)
13. price level
14. cause v
15. trend n
16. interdependent adj
распределение
распределять
делиться, подразделять
поведение
влиять
получать прибыль
изучать
весь, взятый в целом
безработица
доход
темп роста
валовый внутренний продукт (ВВП)
ценовой уровень
быть причиной, вызывать
направление, тенденция
взаимозависимый
Pre-reading Activities
1. Use a dictionary and underline the odd word (лишнее слово) in each line.
Explain your choice and learn the vocabulary.
a) distribution – allocation – consumption
b) examine – deal with – study
c) effect – affect – influence
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d) allocate – connect – distribute
2. Complete the crossword puzzle using your active vocabulary.
1
8
E
C
5
O
2
N
O
3
9
6
M
I
4
7
C
S
1. the state of not having a job
2. complete or full
3. money earned by work or investments
4. to make something happen
5. distribution
6. the amount of money expected, required, or given in payment for something
7. a general direction in which something is developing or changing
8. to inspect (someone or something) thoroughly in order to determine their
nature or condition
9. to have an influence on someone or something, or to cause them to change
Reading
Read the text and check whether you answered the Lead-in questions correctly.
Economics is the science that deals with production, allocation, and use of
goods and services. It is important to study how resources can best be distributed to
meet the needs of the greatest number of people. As we are more connected globally
to one another, the study of economics becomes an extremely important issue.
Economics is a broad subject that can be divided into two areas:
microeconomics and macroeconomics.
Microeconomics, the study of the economic behaviour of small economic
groups such as firms and families, is one of the largest subfields in economics.
Microeconomics deals with economic decisions made at a low, or micro, level. It is
the analysis of the decisions made by individuals and groups, the factors that affect
those decisions, and how those decisions affect others.
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Microeconomics asks questions: “How do individuals make consumption
decisions?”, “How do firms make profits and price their goods and services?”, etc.
“Macro” means “large”. Macroeconomics is the field of economics that studies
the behaviour of the economy as a whole, not just specific companies, but entire
industries and economies. This area of economics examines economy-wide
phenomena such as changes in unemployment, national income, rate of growth, gross
domestic product, inflation and price levels. Macroeconomics asks questions like:
“What causes inflation?”, “What effect does the national debt have on economic
growth?”, etc.
So, macroeconomics is focused on the movement and trends in the economy as
a whole, while in microeconomics the focus is placed on factors that affect the
decisions made by firms and individuals. These two studies of economics are
different, but they are interdependent and complement each other. The factors that are
studied by macro- and microeconomics often influence each other.
Comprehension
1. Match these sentence halves describing economics and its two areas.
1. Microeconomics is
2. Economics is
3. Microeconomics is the study of
4. Macroeconomics seeks to understand
a) the economic behavior of individual
consumers, firms, and industries.
b) one of the two main fields of the social
science of economics.
c) the influence of all economic factors
on each other.
d) a social science concerned with the
production, distribution, exchange, and
consumption of goods and services.
2. Decide whether the following statements are True or False.
1. Resources should be distributed in the best way to meet the needs of people.
2. The study of macroeconomics is an extremely important issue.
3. Microeconomics is one of the largest subfields in economics.
4. Microeconomics is the analysis of the decisions made by individuals and groups.
5. Macroeconomics deals with economic decisions made at a low level.
6. The two studies of economics complement each other.
3. Answer the questions.
1. What is economics?
2. Why is it important to study economics?
3. Is microeconomics the study of the economic behaviour of small economic
groups?
4. What kind of analysis is microeconomics?
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5. What does macroeconomics examine?
6. What questions are asked by the two areas of economics?
7. Do factors that are studied by macro- and microeconomics influence each
other? In what way?
Vocabulary Focus
1. Complete the gaps choosing the right alternative.
1. The current … rate is six percent.
a) behaviour
b) unemployment
c) allocation
2. Cold weather … the crops.
a) affected
b) studied
c) caused
3. I haven't had much … from my business this year.
a) income
b) rate of growth
c) price level
4. Digital technology is the latest … in television.
a) income
b) trend
c) behavior
5. An accountant (бухгалтер) has been employed to … the company's books.
a) cause
b) distribute
c) examine
6. We need to find the best way to … our resources.
a) divide
b) allocate
c) influence
2. Fill in the gaps with prepositions, where necessary.
1. The bank deals directly … the private sector.
2. I need time to study … this contract before signing it.
3. No one knows how this decision will influence … the outcome of the
election.
4. Consumer magazines can be divided … a number of categories.
5. What may cause … unemployment?
3. Look through the text once again and find the words and phrases which
mean the following.
- to satisfy the needs
- a very important subject or problem
- to influence decisions
- the industry as a whole
-to study economy-wide phenomena
Talking Points
1. Imagine that your friend has got an opportunity to take one course in
economics, so he has a choice between macroeconomics and microeconomics. Which
course would be more interesting and useful? What would your advice be? Why?
Use the following expressions:
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I think, I would… (Я думаю, я бы …)
He should perhaps …(Возможно, ему следует …)
In his position, I would … (На его месте я бы …)
2. Prepare to talk about the differences and similarities between
macroeconomics and microeconomics. Complete the statements and share your
opinions.
a) Microeconomics and macroeconomics are the fundamental tools to be learnt,
in order to understand … .
b) While the two studies are different, they are interdependent, and together
they … .
c) The main differences between … are … .
Summary Points
1. Skim the text once more and identify its main idea. Use the necessary
vocabulary from Unit 1 Summary Points.
2. Make up a plan of the text about micro- and macroeconomics. Discuss it in
pairs, then report to the whole group.
This text can be divided into … parts.
Текст можно разделить на … частей.
The text consists of … parts.
Текст состоит из … частей.
The first part is about … .
Первая часть текста – о …
The second (third, fourth) part describes Вторая (третья, четвертая) часть
(analyzes) … .
описывает (анализирует) …
14
UNIT 3
TYPES OF ECONOMIC SYSTEMS
Lead-in
Answer the following questions before you read the text below. If you can’t
answer them now, try to answer them after reading the text.
1. What types of economic systems do you know? What is the difference
between them?
2. What factors may affect the type of economy a country holds? When would
it be beneficial for a country to change its economy?
Key Vocabulary
1. Study the following list of vocabulary.
1. produce v
производить
2. market n
рынок
3. determine v
устанавливать, определять
4. price n
цена
5. trade n
торговля
6. exchange n
обмен
7. government n
правительство
8. society n
общество
9. alleviate v
уменьшать, ослаблять
10. advancement n
развитие
11. decide v
решать
12. free enterprise
свободное предпринимательство
14. private adj
частный
15. wages n
зарплата
16. regulate v
регулировать
17. provide v
предоставить, обеспечить наличие
18. run v
управлять
19. tax n
налог
2. Mind the following forms of the irregular verb “to sell”:
sell (sold, sold)
- продавать
Pre-reading Activities
1. Match synonyms from the two columns. Learn these pairs of words.
1. market
2. to regulate
a) to manage
b) to manufacture
15
3. to produce
4. to run
c) to control
d) marketplace
2. Consult a dictionary and complete the chart. Some boxes will not be filled.
NOUN
production
VERB
to produce
to price
ADJECTIVE
productive
governmental
decision
to regulate
Reading
Read the text focusing on the main ideas.
There are three main questions any economy has to answer, whether it is a
highly developed economy, the poorest of countries, or a small group of people.

What is to be produced?

How will it be produced?

Who will get what is produced?
To answer these questions, different economic systems have been developed.
Traditional economies are dictated by tradition, customs, and religion. One of
the features of this type of economy is very little economic growth. In traditional
societies people use methods of production and distribution which were invented in
the past and have become accepted ways of doing things.
A market economy is an economy in which the prices of goods and services are
determined in a free price system. Trading and exchange of goods, services and
information takes place in a free market. A market economy may, therefore, also be
known as a free market economy. In the real world, market economies do not exist in
pure form, as societies and governments regulate them to different degrees rather than
allow self-regulation.
The opposite of a market economy is a planned or command economy, where
the government decides what to produce, in what quantity, and to be sold at what
price. A planned economy alleviates the use of private enterprises and allows the
government to determine everything from distribution to pricing. Planned economies
can provide stability, but they can also limit the growth and advancement of the
country if the government does not allocate resources to the innovative enterprises.
A mixed economy is the one in which there exists a mixture of free enterprise
and government control. In some areas of a mixed economy, the government may
even have a monopoly. In a typical mixed economy, the government may run such
things as the postal service, rail lines, libraries, and in some cases, the health care
service. Even in industries which are not owned or run by the government, its
influence is very noticeable in the form of taxes and regulations like wage controls.
16
Comprehension Check
1. Are these statements True or False? Use the following expressions:
I (don’t) agree that… (я (не) согласен, что…)
I think that… (я думаю, что…)
1. Any highly developed country has to answer three main questions.
2. Traditional economies are dictated by very little economic growth.
3. A free market economy is an economy in which the prices of goods and
services are determined in a free price system.
4. A planned or command economy is the opposite of a mixed economy.
5. A planned economy is the one that can limit the growth and advancement of
the country.
6. A mixed economy is a mixture of market and planned economies.
7. In a mixed economy the influence of the government is considerable.
2. Complete the sentences.
1. Three main questions any economy has to answer are: … .
2. Different economic systems have developed to … .
3. One of the features of traditional economies is … .
4. In a market economy … takes place in a free market.
5. In a command economy, the government decides … .
6. Planned economies can provide stability, but … .
7. … the government may have a monopoly.
3. Check how well you know some characteristic features of different types of
economic systems. Are these statements about market, command, or traditional
economies?
1.
You can decide what job you would like to do in this economic system.
2.
Making a profit is highly stressed in this economic system.
3.
Making money is not stressed in this economic system.
4.
You will work at the same job that your ancestors worked at in this
economic system.
5.
You produce what your ancestors produced in this economic system.
6.
The government decides what you will produce in this economic system.
7.
You decide what you will produce in this economic system.
8.
You work in this economic system to make as much money as you want.
9.
Competition, material rewards, self-gain, and freedom are the basic
values for this economic system.
10. Custom, traditional ways and beliefs are the basic values of this
economic system.
17
Vocabulary Focus
1. Complete the sentences, choosing the right word.
1. It’s … property!
a) market
b) private
2. He … the car to me for $1000.
a) produced
b) determined
3. This shop … my favorite brand.
a) determines
b) sells
4. Our manager … not to leave.
a) has provided
b) has determined
5. The Prime Minister has formed a new … .
a) market
b) government
6. Most shops allow the purchaser … goods.
a) to alleviate
b) to sell
c) free
c) sold
c) regulates
c) has decided
c) society
c) to exchange
2. Look through the text and find English equivalents.
устанавливать цены
торговля и обмен товарами и услугами
саморегулирование
решать, в каком количестве производить
обеспечить стабильность
правительственный контроль
находиться во владении и управляться государством
3. Match the words from Key Vocabulary with their definitions.
a) an organized group of people associated together for religious, cultural,
scientific, political, patriotic, or other purposes
b) a sum of money demanded by a government for its support or for specific
facilities or services
c) the sum or amount of money or its equivalent for which anything is bought,
sold, or offered for sale
d) money that is paid or received for work or services, as by the hour, day, or
week
e) the act or process of buying, selling, or exchanging commodities within a
country or between countries
Talking Points
1. Think about features, advantages and disadvantages of different types of
economic systems. Discuss these issues in pairs or small groups first, and then make
a report.
18
Traditional
economies
Market
economies
Planned
economies
Mixed
economies
Features
Advantages
Disadvantages
2. List countries which have these economic systems.
Summary Points
1. Look through the text about different types of economic systems once more
and identify its main idea.
2. Draw up an outline of the text.
3. Can this text be divided into some parts? How many and what are they?
Give a one-sentence summary of each point of your plan.
Use the following vocabulary:
This text can be divided into … parts. Текст можно разделить на … частей.
The text consists of … parts.
Текст состоит из … частей.
The first (second, third, etc.) part deals В первой (второй и т.д.) части говорится
with …
о…
In the first (second, third, etc.) part the В первой (второй, третьей) части автор
author describes (discusses, studies, описывает (обсуждает, изучает,
offers, states, analyzes) …
предлагает, утверждает, анализирует) …
Finally, the author shows …
В заключение, автор показывает …
19
UNIT 4
SCARCITY AND CHOICE
Lead-in
Working in a group, try to identify the term ‘scarcity’ and answer the following
questions.
1. Why does scarcity exist?
2. How do individuals, communities and countries attempt to solve the
problem of scarcity?
Key Vocabulary
Make sure you know the following words and word-combinations.
удовлетворять
сталкиваться с
земля, земельные угодья
труд, рабочая сила
капитал
недостаточный
существовать
экономическая деятельность
польза, прибыль
отказываться, воздерживаться от чего-либо
альтернативные
издержки;
издержки
неиспользованных возможностей
оценивать
неденежный
1. satisfy v
2. face v
3. land n
4. labour n
5. capital n
6 insufficient adj
7. exist v
8. economic activity
9. benefit n
10. forgo v
11. opportunity costs
12. evaluate v
13. non-monetary adj
Pre-reading Activities
1. Consult a dictionary and find in the columns groups of synonyms and
antonyms.
Match synonyms:
desire n
forgo v
benefit n
choose v
Match antonyms:
balance n
profit n
select v
give up v
want n
abundance n
20
scarcity n
monetary adj
limited adj
non-monetary adj
unlimited adj
imbalance n
2. Translate in writing the following paragraph.
Scarcity is the fundamental economic problem: humans have unlimited wants
and needs in a world of limited resources. It states that society has insufficient
productive resources to satisfy all human wants and needs. Goods (and services) that
are scarce are called economic goods (or simply goods). Other goods are called free
goods if they are desired but in such abundance that they are not scarce, such as air
and seawater.
Reading
Read the text and explain what the terms “scarcity” and “opportunity cost”
mean.
Scarcity is the fundamental economic problem. Not all human needs and wants
can be satisfied, scarcity limits us both as individuals and as a society. As individuals,
we face scarcity of time and ability. As a society, our resources, land, labor, and
capital, are insufficient to produce all the goods and services we might desire.
So, scarcity is the condition of not being able to have all of the goods and
services a person wants. It exists because a society can only produce limited amounts
of goods and services with the limited resources. The resources, however, have
alternative uses and can be combined in various proportions. With the alternative use
of scarce resources, choices must be made.
People must choose how to use scarce resources and which of their desires they
will satisfy and which they will leave unsatisfied. When we, either as individuals or
as a society, choose more of something, scarcity forces us to take less of something
else.
Economics is sometimes called the study of scarcity because economic activity
would not exist if scarcity did not force people to make choices. The fact that choices
must be made reflects the fact that scarcity exists.
Scarcity is an imbalance between what is wanted and the amount that is freely
available. Choice, in economic terms, is rational choice and is defined as an act of
making calculated, self-interested decisions. Basically, this type of choice is about
choosing what will cost the least and have the highest benefit.
In making a choice, some alternatives are forgone. Economists use the term
‘opportunity cost’ to mean the cost of a specific choice measured in terms of the next
best alternative choice. In other words, it is what the decision-maker must forgo in
order to make the choice that is finally made. Another term for opportunity cost is
“real cost”. Opportunity cost is useful when evaluating the cost and benefit of
choices. It is often expressed in non-monetary terms.
21
Comprehension Check
1. Answer the questions.
1.
2.
3.
4.
5.
6.
Why are scarcity and choice basic problems of economics?
What is scarcity? Give different definitions.
Why must people make choices?
What is choice?
What do economists mean when they use the term ‘opportunity cost’?
In what way is opportunity cost expressed?
2. Are these statements True or False? Prove your decision.
1. Human needs and wants can’t be satisfied.
2. Scarcity exists because society can produce limited amounts of goods and
services with insufficient resources.
3. Scarcity forces us to forgo some alternatives.
4. Economics is sometimes called the study of choice.
5. ‘Opportunity cost’ is what the decision-maker must forgo in order to make
the choice that is finally made.
6. Opportunity cost is the fundamental economic problem.
3. Reproduce the context in which the following word-combinations are used.
to satisfy needs and wants
to produce goods and services
economic activity
scarce resources
to forgo alternatives
to evaluate the cost and benefit
Vocabulary Focus
1. Complete the gaps using the vocabulary.
choice;
free goods; limited; opportunity cost;
scarce; scarcity; services; unlimited
resources;
… (1) are important because they are used to make goods, like television, cars
and houses and to provide …(2), like banking, insurance and transport. All of these
resources are …(3). Any resources that are not scarce are called …(4). Wants are
…(5) but the resources used to produce the goods and services to satisfy these wants
are …(6). So, there exists …(7). …(8) is necessary because scarce resources can be
used in lots of ways to make different goods and services. The real cost of choosing
one thing and not another is known as the …(9).
22
2. Choose the right word to complete the sentences.
1. Hunger ... in many parts of the world.
a) evaluates
b) exists
c) satisfies
2. We have to … the results of our experiment.
a) face
b) forgo
c) evaluate
3. We want to build a house. Last year we bought some … in the village.
a) capital
b) labour
c) land
4. The company offers its employees a pension plan, free health insurance, and
other … .
a) economic activity
b) benefits
c) desires
5. The wants we seek to … are limited.
a) satisfy
b) forgo
c) face
3. Give the English equivalents to the following.
ограниченные ресурсы
вынуждать людей делать выбор
оценить затраты и выгоды
рациональный выбор
лицо, принимающее решение
Talking Points
1.
Explain the fact that people exchange goods and services because they
expect to be better off (материально жить лучше) after the exchange.
2.
Explain that whenever a choice is made, something is given up.
3.
Discuss the following question with your groupmates. Give your
arguments for or against.
Do you agree that the problem of scarcity is faced by rich and poor societies?
Summary Points
1. What is the main idea of the text about scarcity and choice? Is it only to
explain what scarcity and choice are?
2. Divide the text into parts and make up a plan. What are these parts about?
3. Find in the text the most important details that may be added to support the
main points. Use the following vocabulary.
The author thinks (believes) that …
The author notes that …
According to the author …
In conclusion …
Автор думает (считает), что…
Автор отмечает, что …
Согласно мнению автора …
В заключение …
23
UNIT 5
DEMAND AND SUPPLY
Lead-in
1. Discussing in groups or pairs, try to identify the factors that influence:
a. consumer’s decisions to demand goods or services
b. producer’s decisions to supply goods or services
2. Do you know how the law of demand and supply works?
Key Vocabulary
Study the following vocabulary.
1. buyer n
покупатель
2. seller n
продавец
3. demand n
спрос
4. supply n
предложение
5. have an influence on smth
оказывать воздействие на что-либо
6. competitive adj
конкурентоспособный, конкурентный
7. interact v
взаимодействовать
8. support v
поддерживать
9. pay v
платить
10. commodity n
продукт, товар
11. law n
закон
12. quantity n
количество
13. consumer n
потребитель
14. substitute n
заменитель
15. complementary adj
дополняющий (о товаре)
16. increase n
увеличение, рост
17. profitable adj
прибыльный
18. tend v
иметь тенденцию
19. encourage v
побуждать, стимулировать
20. influence smth v
влиять на что-либо
21. equal adj
равный, одинаковый
22. attain v
достигать
23. state of equilibrium
состояние равновесия
Pre-reading Activities
1. Mind the pronunciation of the following words. Learn this vocabulary.
increase (n) - ['inkri:s] – увеличение, рост
increase (v) - [in'kri:s] – возрастать, усиливаться
24
decrease (n) - ['di:kri:s] – уменьшение, спад
decrease (v) - [di'kri:s] – уменьшаться, сокращаться
equal (adj) - ['i:kwəl] – равный, тождественный
equal (v) - ['i:kwəl] – быть одинаковым, равным
2. Use one of the words from Task 1 to complete the sentences. Mind grammar
forms.
1. Our company provided … employment opportunities.
2. We divided the profits into three … shares.
3. Unfortunately, sales … by five percent this year.
4. They will soon … the price from $50 to $60.
5. These changes will … our expenses.
6. His salary … mine.
Reading
Read the text and single out the following notions:

a competitive market

the law of demand

the law of supply
A market is defined as a group of buyers and sellers of a particular product or
service. Competitive markets are markets with many buyers and sellers, so that each
has a very small influence on the price. Supply and demand is the most useful model
for a competitive market, and shows how buyers (citizens) and sellers (businesses)
interact in that market.
The first thing to understand is that demand is not the same as desire, or need,
or want. When desire is supported by the ability and willingness to pay the price, it
becomes an effective demand and has an influence in the market.
Demand, in economics, may be defined as “the quantity of the commodity
which will be demanded at any given price over some given period of time”.
According to the law of demand, price has a significant effect on demand. Consumers
will buy less at higher prices and more at lower prices.
Among the factors which influence consumers to buy more or less of a product,
even when the price of the product does not change are:

Income

Tastes and preferences

Substitutes

Complementary goods
Supply is not the same thing as “amount available”. We are only concerned
here with the amounts actually brought to market and these amounts depend on the
ruling market price. The basic law of supply says “More will be supplied at a higher
price than at a lower price”. An increase in price usually means that production will
25
become more profitable. In addition, an increase in price would tend to encourage
new firms to enter the industry.
In addition to price, there are other factors that will strongly influence the
amount of a good or service supplied to the market:

Number of producers

Resource prices
It is possible for supply and demand to be equal. In this case, the amount of
supplied products or services must equal the demand for those products and services.
If this relationship between supply and demand is attained, the economy is balanced
in a state of equilibrium.
Remember!
If supply continues to increase and demand softens (or even
remains constant), prices will continue to fall.
Comprehension Check
1. Answer the questions.
1. What is a market? What is a competitive market?
2. What does “supply and demand” model show?
3. When does desire become an effective demand?
4. Do prices have any effect on demand? Why?
5. What factors influence consumers to buy more or less of a product?
6. What do the basic laws of demand and supply say?
7. What influences the amount of a good or service supplied to the market?
8. Is it possible for supply and demand to be equal? In what case?
2. Complete the following statements.
1. Buyers and sellers in a competitive market … .
2. … is not the same as desire.
3. “The quantity of the commodity which will be demanded at any given price
over some given period of time” is … .
4. According to the law of demand, consumers … .
5. Production will become more profitable if … .
6. A state of equilibrium is … .
3. Do you agree with the following statements? Use the given vocabulary to
explain your choice.
26
In my opinon, … (на мой взгляд…)
It would be more correct to say that … (было бы правильнее сказать, что…)
I’m afraid, I disagree with… (боюсь, я не согласен с…)
1. Supply and demand is a model for a competitive market, which shows how
buyers and sellers influence prices.
2. Demand is the ability and willingness to pay the price.
3. According to the law of demand, price has a great influence on demand.
4. More goods will be supplied at a higher price than at a lower price.
5. If supply and demand are equal, the economy is balanced in a state of
equilibrium.
Vocabulary Focus
1. Match the words from Key Vocabulary with definitions:
a) any written rule or collection of rules
b) a person who sells
c) to achieve or accomplish
d) to give some money in exchange for something
e) a particular or indefinite amount of anything
f) a person who buys commodities or services
2. Look through the text and find the equivalents or synonyms of the following
words.
goods n
affect v
cooperate v
consumer n
beneficial adj
3. Use the vocabulary of the text to complete the sentences. Guess the suitable
word by the first letter.
1. You need a degree to be c… in today's job market.
2. I completely s… your decision to buy new equipment.
3. He thinks that the new regulations will e… people to invest.
4. The car can a… a top speed of 200 km/h.
5. These two chemicals i… with each other at a certain temperature.
6. The boss is worried about q… as well as quality.
Talking Points
1. Do you know the difference between needs and wants, goods and services?
Match each item correctly. Write the letter in the blank and give your own examples
of:
_____1. Needs
27
_____2. Wants
_____3. Goods
_____4. Services
_____5. Market
A. Works that are performed for someone.
B. Basic requirements for survival.
C. Location or other mechanism that allows buyers to exchange economic
products.
D. Means of expressing needs.
E. Tangible commodities.
2. Suppose that there has been a decline in the price of pork (свинина). What
effect will this have on the market for beef (говядина)?
3. Which of the following provides an example of complementary goods? Think
of your own examples of complementary goods.
a) Pepsi and Coca-Cola
b) French fries and ketchup
c) Milk and orange juice
d) Beef and pork
Summary Points
1. Identify the main idea of the text “Demand and Supply”.
2. Divide the text into logically completed parts and make up a plan of this text.
3. Describe each point of your plan using phrases from Summary Points (Units
1-4). Use some other words and expressions to show the logical connection between
the parts of the summary:
On the one hand,… On the other hand, …
It should be mentioned that …
The author comes to the conclusion…
On the whole…
In brief …
Thus …
After reading the text (article, passage)
we realize the fact that …
С одной стороны…; с другой стороны
Следует отметить, что …
Автор приходит к выводу …
В целом …
Вкратце, в двух словах …
Таким образом, итак …
Прочитав текст (статью, отрывок), мы
понимаем (убеждаемся), что …
28
Unit 6
OPPORTUNITY COST
Lead-in
Express your opinion on the following issues.
1. Is scarcity an economic or social issue?
2. Is it possible to solve the problem of scarcity? Why?
Key Vocabulary
Study the following list of vocabulary.
1. scarce/ limited resources
дефицитные, ограниченные ресурсы
2. save v
копить, откладывать, экономить
3. reduction n
снижение, понижение, сокращение
4. value n
ценность, стоимость
5. efficient adj
действенный,
результативный,
эффективный
6. restrict v
ограничивать
7. financial costs
расходы по финансовым операциям
8. utility n
полезность
9. assess v
оценивать, давать оценку
10. cost n
стоимость
11. loss n
убыток, ущерб, потеря
12. purpose n
цель, намерение
13. prevent smb from
предотвращать, предупреждать
14. implement v
выполнять, осуществлять
15. application n
применение, использование
Pre-reading Activities
Match the words on the left with those on the right. Then translate the
expressions into Russian.
1. make
a. costs
2. scarce
b. choice
3. opportunity
c. money
4. available
d. decisions
5. financial
e. cost
6. earn
f. land
7. sell
g. alternatives
8. career
h. resources
29
Reading
Read the following text and be ready to explain what “opportunity cost”
means.
Economists are concerned with how we make choices in a world of scarce
resources. Individuals, families, business firms and governments must make
decisions about how best to allocate limited resources. But when resources are
limited, choices are limited as well. This means that the decision to have one thing is,
at the same time, the decision not to have something else. Suppose, for example, that
the government chose to pay for the increase in the size of its air force with the
money it had saved by building fewer schools. In that case the increase in defense
was paid for by a reduction in the number of schools.
So, the opportunity cost of any decision is the value of the next best
alternative that is given up. The concept of opportunity cost was first developed by
John Stuart Mill. It is a key concept in economics. It has been described as expressing
the basic relationship between scarcity and choice. The notion of opportunity cost
plays an important role in ensuring that scarce resources are used efficiently.
It is important to understand that opportunity costs are not restricted to
financial costs, but lost time, pleasure or any other benefit that provides utility should
also be considered as opportunity costs.
Assessing opportunity costs is fundamental to assessing the true cost of any
course of action. However, opportunity cost is not the sum of the available
alternatives when those alternatives are mutually exclusive to each other. The
opportunity cost of the city’s decision to build the hospital on its vacant land is the
loss of the land for a sports center, or the inability to use the land for a parking lot, or
the money which could have been earned from selling the land, as using any one of
those purposes would prevent the possibility to implement any other. It is also the
cost of the forgone products after making a choice.
In the science of economics the concept of opportunity cost has a wide
range of applications, including a consumer choice, production possibilities, cost of
capital, time management and a career choice.
Comprehension Check
1. Agree or disagree with these statements about the text.
1. When resources are limited, our choices are not limited.
2. The opportunity cost of any decision is the value of the next best alternative
that is given up.
3. The concept of opportunity cost is a key concept in economics.
4. The concept of opportunity cost was first developed by Alfred Marshall.
5. Assessing opportunity costs is fundamental to assessing the true cost of any
course of action.
30
2. Complete the sentences using the information from the text.
1. The concept of opportunity cost has been described as ………
2. It is important to understand that opportunity costs are not restricted ………
3. Opportunity cost is not the sum of the available alternatives ………
4. Opportunity cost is also the cost of the forgone ………
3. Choose the sentence which best explains the role of opportunity cost in
economics.
A. In the science of economics the concept of opportunity cost has a wide range
of applications.
B. The concept of opportunity cost is a key concept in economics and it plays
an important role in ensuring that scarce resources are used efficiently.
C. The decision to have one thing is, at the same time, the decision not to have
something else.
Vocabulary Focus
1. Match the words on the left with their synonyms on the right.
1. scarce
a. evaluate
2. economize
b. save
3. costs
c. price
4. assess
d. limited
5. cost
e. expenses
2. Use the words from the list of Useful Vocabulary to complete the sentences.
1. Those who make financial contributions to firms for the ..... of earning profit
are known as investors.
a. growth
b. purpose
c. supply
2. Good managerial work is of great ….. for obtaining high profits.
a. value
b. opinion
c. scarcity
3. In a free market economy producers try to ….. all consumers’ tastes.
a. prevent
b. demand
c. satisfy
4. Opportunity ….. are to be calculated for labor and financial capital used in
production.
a. costs
b. decisions
c. choices
5. The purpose of governmental regulations is to allocate ….. resources
rationally.
31
a. expensive
b. efficient
c. scarce
3. Give the English equivalents to the following expressions.
развивать концепцию
играть важную роль
дефицитные ресурсы
управление временем
выбор потребителей
оценить стоимость
Talking Points
1. Try to explain the term “opportunity cost” in your own words.
2. Discuss the following issues in small groups and then report your findings.
a. What is the opportunity cost involved in a decision to continue education
after finishing school?
b. What was the opportunity cost of your latest major purchase?
Summary Points
1. Revise the list of basic steps in summarizing.
1. Skim the original text and identify its main idea.
2. Divide the text into logically completed parts.
3. Read the text again and draw up an outline of the text.
4. Give a one-sentence summary of each item of the outline in your own words.
5. Find in the original text the most important details that may be added to
support the main points.
6. Use appropriate words and phrases to show the logical connection between
the parts of the summary.
2. Divide the phrases for summarizing into 3 groups and fill in the table.
Introduction
Main Body
Conclusion
The author comes to the conclusion that ………
Thus ………
The author thinks that ………
According to the author………
On the one hand ……… on the other hand ………
32
The text deals with ………
The basic topic is ………
The author notes that ………
After reading the text we realize the fact that ………
3. Summarize the text from Reading. Use phrases for your summary from Task
2.
33
UNIT 7
MONEY
Lead-in
1. Do you agree with those who say that
time is money? Give your arguments.
2. In your opinion, what’s the best way of
making a lot of money?
3. In our everyday lives we often refer to
“money” as one of three things: coins and paper
money (currency); a person’s wealth; a person’s
income. Using this vocabulary and working with a
partner, try to define the term ‘money’.
Key Vocabulary
1. Study the following vocabulary.
1. transaction n
2. commodity money
3. fiat money
4. coin n
5. value n
6. checking account
7. savings account
8. exchangeable adj
9. durable adj
10. valuable adj
11. medium of exchange
12. facilitate v
13. barter n,v
14. store of value
15. unit of account
16. purchase v
17. to conduct a transaction
18. supplier n
19. purchaser n
20. eliminate v
21. division of labour
сделка
товарные деньги
неразменные деньги (деньги, не имеющие
реального обеспечения в форме драгоценных
металлов)
монета
ценность, стоимость
текущий счёт (в банке)
сберегательный счёт
подлежащий обмену
постоянный, с длительным сроком службы
имеющий ценность
средство обмена
облегчать, способствовать
товарообмен; менять, обменивать
средство сбережения
мера стоимости (единица измерения)
покупать, приобретать
проводить торговую операцию, сделку
поставщик
покупатель
устранять
разделение труда
34
2. Mind the following irregular plural nouns:
money is used only in the singular (в единственном числе), e.g. Where
is my money? This money is mine. Money makes money.

medium – media
- средство - средства

Pre-reading Activities
1. In your “Key Vocabulary”, find synonyms and antonyms to the words below.
Use a dictionary and learn this vocabulary.
Give synonyms to:
buy v
buyer n
exchange v
deal n
Give antonyms to:
temporary adj
valueless adj
seller n
Reading
Read the text and get ready to define all the types and functions of money.
Money is any good that is widely used and accepted in transactions involving
the transfer of goods and services from one person to another. Economists
differentiate between three different types of money: commodity money, fiat money,
and bank money.
Commodity money is a good whose value serves as the value of money. Gold
coins are an example of commodity money.
Fiat money is money that has value only because of the government regulation
or law. Dollar bills are an example of fiat money.
Bank money is the balance held in checking accounts and savings accounts.
Bank deposits usually form the larger part of the money supply of a country.
Some people may think that money's function is limited to one use — to buy
things. Money actually has three functions, which allow money to be exchangeable,
durable, and valuable. Classically it is said that money acts as a medium of exchange,
a unit of account, and a store of value.
The most important function of money is as a medium of exchange to facilitate
transactions. Without money, all transactions would have to be conducted by barter,
which involves direct exchange of one good or service for another. The difficulty
with a barter system is that in order to obtain a particular good or service, a person
has to possess a good or service of equal value, which the supplier also desires.
In order to be a medium of exchange, money must hold its value over time; that
is, it must be a store of value. But as a store of value, money is not unique; many
other stores of value exist, such as land, works of art, stamps.
Money also functions as a unit of account, providing a common measure of the
value of goods and services being exchanged. Knowing the value or price of a good,
35
in terms of money, enables both the supplier and the purchaser of the good to make
decisions about how much of the good to supply and how much of the good to
purchase.
Today money is considered one of the outstanding inventions of the entire
history of mankind. The introduction of money has eliminated all the difficulties of a
barter system, it has made easy to save wealth for future, and has played a significant
role for the specialization in business through the division of labour. Although money
itself creates nothing, it is very helpful in the process of production, consumption and
exchange.
Comprehension Check
1. Say whether these statements are True or False:
1. Economists differentiate between three different types of money: commodity
money, a store of value, a unit of account.
2. Commodity money is a medium of exchange that may be transformed into a
good, useful in production or consumption.
3. Bank money is money that has value only because of the government
regulation.
4. The function of money is limited to one use — to buy things.
5. Barter involves direct exchange of one good or service for another.
6. The most important function of money is a store of value.
7. There are many different stores of value.
8. Knowing the value or price of a good enables suppliers and purchasers to
make different decisions.
2. Read the text more carefully and complete the following statements. In some
cases more than variant is possible.
1. Money is … .
2. Commodity, fiat and bank money are … .
3. Bank money is … .
4. Money can be … .
5. Without money … .
6. … in order to be a medium of exchange.
7. As a unit of account, money … .
8. The introduction of money … .
3. Prepare to speak about money. Firstly, complete the following plan of the
text.
1. Different types of money:
a. ……
b. ……
c. ……
2. …….
a. ……
36
b. Money as a store of value.
c. ……..
3. ………
Vocabulary Focus
1. Complete the definitions.
a) to trade by exchange of commodities rather than by the use of money is to …;
b) … is a system of organizing the manufacture of goods in a series of separate
operations, each of which is carried out by a different worker or group of workers;
c) a piece of metal stamped and issued by the government for use as money is a …;
d) a … is someone whose business is to supply a particular service or commodity;
e) to … means ‘to make easier or less difficult’.
2. Complete the sentences with the words from the box. Mind grammar forms.
valuable
a unit
account
of facilitate
durable
eliminate
a medium of
exchange
1. Careful planning … any kind of work.
2. The company plans to … more than 2,000 jobs in the coming year.
3. The machines have to be made of … materials.
4. … is a standard monetary unit of measurement of value of goods, services,
or assets.
5. Something commonly accepted in exchange for goods and services and
recognized as representing a standard of value is … .
6. This painting is extremely … .
3. Match the verbs on the left with nouns on the right to make phrases from the
text.
Translate them and use in the sentences of your own.
to use in
to purchase
to create
to facilitate
to eliminate
to obtain
transactions
goods and services
difficulties
Talking Points
1. Think and say whether you agree or disagree with the following quotations
and proverbs. Be ready to express your opinion and give their Russian equivalents.
37
a) A penny saved is a penny earned.
b) Lend your money and lose your friend.
c) Money talks.
d) Never spend your money before you have it.
2. Plastic money has become the alternative to cash or standard money
nowadays. In small groups brainstorm the questions: Are credit cards a form of
money? If not, why do we call them ‘plastic money’? What are their advantages and
disadvantages?
3. What do you know about WebMoney? How can people use it and why is it
convenient?
Summary Points
1. Read the passage. What title can you suggest?
Most of the money used by business comes from the sale of its products and
services. Since these funds come from within the firm they are described as internal
funds. The rest must come from outside, or external funds.
As a firm sells its products or services, it receives money, which it uses to meet
its expenses. One of these expenses, depreciation, represents the cost of replacing
assets (like tools, machinery, and buildings) that wear out. Typically, businesses use
internal funds to cover the cost of depreciation.
Notes:
internal / external – внутренний / внешний
depreciation – изнашивание (в результате
устаревания); списание стоимости;
wear out – изнашивать(ся)
износа
и
морального
2. What is the main idea of the passage?
3. What have you learned from this passage? Use the given expressions.
The author describes (discusses, studies, автор описывает (обсуждает, изучает,
offers, states, analyzes) …
предлагает, утверждает, анализирует)
…
On the one hand … on the other hand … С одной стороны…; с другой стороны
…
After reading the passage I have Прочитав отрывок, я понял(а) …
understood …
38
Unit 8
MARKETS AND PRICES
Lead-in
1. Express your opinion on the following issues.
1. How would you define the term “market” in your own words?
2. What factors influence prices in the market?
2. Finish the phrase.
- If I were a marketer, I would ……… .
Key Vocabulary
Study the following list of vocabulary.
1. arrangement n
договорённость, соглашение
2. stock exchange
фондовая биржа
3. intermediary n
посредник
4. transact v
вести дела, заключать сделки
5. on behalf of smb
от имени кого-либо
6. scope n
масштаб
7. competition n
конкуренция
8. preference n
предпочтение
9. price n
цена
10. entrepreneur n
предприниматель, бизнесмен
11. currency n
валюта
12. securities n
ценные бумаги
13. flexible adj
гибкий, эластичный
14. outcome n
итог, результат
15. take into account/consideration
принимать во внимание
16. cash n
наличные деньги
Pre-reading Activities
1. Study the meanings of the following concepts.
1. perfect competition – чистая конкуренция: рыночная структура, при
которой большое число фирм предлагает однородный продукт и ни одна фирма
не имеет достаточно большой доли рынка; в результате производитель не имеет
контроля над ценой, по которой продаётся продукция и может манипулировать
только объёмом своего выпуска.
2. monopolistic competition – монополистическая конкуренция: рыночная
структура, относящаяся к несовершенной конкуренции, при которой фирмы
39
конкурируют, но при этом имеют черты монополий, поскольку производят
дифференцированный продукт.
3. monopoly – монополия: рыночная структура, характеризующаяся
наличием на рынке какого-либо блага единственного продавца и большого
количества покупателей, отсутствием совершенных заменителей продукции
продавца, отсутствием свободы входа на рынок; в силу этих характеристик
продавец обладает абсолютной властью над рыночной ценой.
4. oligopoly – олигополия: рыночная структура, характеризующаяся
существованием на рынке незначительного числа продавцов при наличии
большого числа покупателей.
2. Translate the sentences into Russian. Mind the words from exercise 1.
1. Monopoly is known as a situation in which one seller controls the total
supply.
2. Each oligopolistic firm keeps a close eye on the activities of other firms in
the industry.
3. The retail gas market is a good example of an oligopoly, because a small
number of firms control a large market share.
4. The real world is widely populated by monopolistic competition.
5. The best examples of monopolistic competition come from retail trade,
including restaurants, clothing stores, and convenience stores.
6. Perfect competition is an idealized market structure which achieves an
efficient allocation of resources.
Reading
Read the text and answer the questions that follow it.
The study of markets and other ways of organizing production of goods and
services is an important task of economics.
In ancient times a market was a place where people gathered to buy and sell
goods. Nowadays the term «market» has a broader sense. According to its definition,
market is a set of arrangements by which buyers and sellers are in contact to
exchange goods and services. It is considered to be the institution through which
buyers and sellers interact.
The interaction may be different. For example, street markets, fruit stalls and
shops physically bring together buyers and sellers. At the same time, suppliers and
customers can interact through more complex markets. The Stock Exchange is known
to operate through intermediaries (stockbrokers) who transact business on behalf of
their clients. At the century of IT boom people can make exchanges on the phone.
They are in the market even if they don’t actually visit a store. Similarly, people can
order goods and services by mail or on the Internet, where it is possible to make deals
all over the world. And again they are in the market because they make a voluntary
exchange, when both parties benefit.
As for their scope, markets can be local, national and international. Economists
classify markets according to prevailing conditions and try to determine a market
40
structure. There are specific names for different market structures. They are pure
competition, monopolistic competition, monopoly and oligopoly.
The preferences of sellers and buyers are determined by the supply and demand
in various markets and the outcome of these preferences is a system of prices. A price
is the main index which sellers, entrepreneurs and consumers take into account while
making their free choice according to their self-interests. In economics, the term
“price” denotes consideration in cash for the transfer of something valuable, such as
goods, services, currencies, securities, etc.
Prices perform two important functions: they ration scarce resources and
motivate production. As a rule, the more scarce something is, the higher its price will
be and the fewer people will want to buy it.
Prices play an important role in different markets. If there were no price
system, it would be impossible to determine value of any goods or services. For
example, in a market economy prices act as signals. Buyers and sellers use prices as
signals to communicate their wants and then exchange money for goods and services.
So, a high price is a signal for sellers to produce more and for consumers to buy less.
A low price is a signal for sellers to produce less and for consumers to buy more.
That is why prices serve as a link between producers and consumers. Moreover, in a
market economy the price system is flexible and it can adjust to changes quite
quickly.
Comprehension Check
1. Answer the following questions.
1. What was the role of market in ancient times?
2. What definition of the term “market” is given in the text?
3. According to their scope, how are markets classified?
4. What examples of market structures are given in the text?
5. What does the term “price” mean?
6. What are the basic functions of prices?
7. What do prices mean as signals?
2. Choose the paragraph, where different kinds of interaction between buyers
and sellers are described.
A. 2
B. 3
C. 5
3. Choose the sentence which best summarizes the last paragraph of the text.
A. In a market economy the price system is flexible.
B. A low price is a signal for sellers to produce less and for consumers to buy
more.
C. Prices play an important role in different markets.
Vocabulary Focus
1. Match the words with their definitions.
41
1. monopoly
2. oligopoly
3. monopolistic
competition
4. perfect
competition
5. market
a. a form of imperfect competition that exists when there are many
producers or sellers of similar but differentiated goods and services
b. an event or occasion, usually held at regular intervals, at which
people meet for the purpose of buying and selling goods and
services
c. exclusive control of the market supply of a product or service
d. a market situation in which control over the supply of goods is
held by a small number of producers each of whom is able to
influence prices and thus directly affect the position of competitors
e. a market situation in which there exists a homogeneous
(однородный) product, freedom of entry, and a large number of
buyers and sellers none of whom individually can affect prices
2. Use the words from the list of Useful Vocabulary to complete the sentences.
1. Price elasticity is only one of the problems studied by economists in the
theory of demand and ….. .
a. competition
b. currency
c. supply
2. The marketing concept says that marketing managers should meet the needs
of ….. .
a. securities
b. consumers
c. entrepreneurs
3. The ….. of some goods doesn’t vary greatly within a particular market as all
sellers impose practically the same prices.
a. price
b. outcome
c. scope
4. ….. often leads to lower prices and the introduction of differentiated
products.
a. stock exchange
b. arrangement
c. competition
5. Some experts say a ….. is a person who can create out of nothing a viable
business.
a. entrepreneur
b. buyer
c. seller
3. Give the English equivalents to the following expressions.
- международный рынок
- определить стоимость товаров и услуг
42
- рыночная экономика
- гибкая цена
- заказывать товары и услуги по почте
- покупать и продавать товары и услуги
- спрос и предложение
Talking Points
1. Give your arguments to support the following statements.
A. Marketing helps people satisfy their needs and wants.
B. Prices serve as a link between producers and consumers.
2. Express your opinion on the following points.
1. If you had such a chance, what goods and services would you promote in the
Belarusian market? Explain your choice, using the following expressions.
- I think …
- In my opinion …
- To my mind …
- As for me …
- It seems to me …
2. Prove or disprove that price stability (i.e. keeping inflation low) is more
important than other economic aims, such as attempting to reduce unemployment.
Summary Points
1. Look through the text from Reading once more and divide it into 6 logical
parts.
2. Fill in the missing points in the plan of the text.
I. What is market?
II.
III.
IV.
V. Functions of prices.
VI. The role of prices in different markets.
3. Use the plan of the text to summarize its contents.
43
Unit 9
FACTORS OF PRODUCTION
Lead-in
1.
Of the three factors of production in classical economics – land, labour,
and capital – land may be the most difficult to define. In your opinion, does it refer
just to the land itself?
2.
Do you agree that understanding the factor of entrepreneurship is an
important part of understanding the dynamics of the market economy? Why?
Key Vocabulary
Study the following vocabulary and do the task that follows.
1. create v
2. inputs n
3. distinguishable from
4. natural resources
5. deposit n
6. oil n
7. activity n
8. demands n
9. undertake action
10. assist v
11. entrepreneurship n
12. take place
13. risk-bearing n
14. carry out v
15. sole-proprietor n
16. share v
создавать
затраты на производство
отличимый от
природные ресурсы
залежь, месторождение
нефть
деятельность
потребности
предпринимать действие
помогать
предпринимательство
иметь место, случиться
принятие риска
выполнять
частный предприниматель
делить
Pre-reading Activities
1. Use key vocabulary to complete the sentences.
1. Macroeconomics studies the total output of a nation and the way the nation
allocates its limited … of land, labor and capital.
a) resources
b) oil
c) activity
2. A customer's … are usually safety, quality, and value.
a) deposits
b) resources
c) demands
3. If you … ownership of your business with someone else, your business will
not be a sole proprietorship.
a) assist
b) share
c) create
44
4. Inform me where the conference will … .
a) undertake action
b) carry out
c) take place
5. Management skills can be a separate factor of production called … .
a) inputs
b) entrepreneurship
c) risk-bearing
6. My secretary … in making the decision.
a) assisted
b) shared
c) carried out
Reading
Read the text and find out what factors of production are.
Economists have long recognized the three major factors that people use to
create the things they want. Land, labor, and capital are "factors of production”, or
“inputs”. Each factor plays an important role in the production of goods, and each
factor is clearly distinguishable from the other two.
Land includes not only the site of production but natural resources above or
below the soil. These are agricultural land, mineral deposits, forest, rivers, lakes, oil
deposits, mountains, etc. Land is a passive factor in production. To make the gifts of
nature satisfy our needs and desires, human beings must do something with natural
resources. This activity is called labour.
Thus, labour is human effort – physical and mental – which is directed to the
production of goods and services. But labour is not only a factor of production, it is
also the reason why economic activity takes place. The people who take part in
production are also consumers, the sum of whose individual demands provides a
business person with the incentive to undertake action.
Capital is a man-made resource. Any product of labour and land which is
reserved for use in the further production is capital.
Capital was created when people began to make simple tools to assist them in
the production of food, the hunting of animals, and in the transportation of their
possessions.
Entrepreneurship is also sometimes considered a factor of production. Land,
labour, and capital will not produce anything. There must be some person or persons
who will organize these three factors so that production takes place. Someone must
take the decisions what, how, and where to produce. Whoever takes the decisions and
the risks is known as an entrepreneur.
Organisation, management and risk-bearing – these are the entrepreneurial
functions. In a one-person business, they are all carried out by the sole-proprietor. In
a large company, the functions are shared.
Remember!
45
Comprehension Check
1. Use the best alternative to complete the statements.
1. The term "factors of production” means the same as …
a) natural resources;
b) inputs;
c) production of goods and services.
2. Land is …
a) human effort;
b) man-made resource;
c) a passive factor.
3. Capital is …
a) the reason why economic activity takes place;
b) any product of labour and land;
c) directed to the production of goods and services.
4. Entrepreneurship is …a) a one-person business;
b) organization and management;
c) the practice of starting a new business.
2. Are these statements True or False? Correct the false ones.
1. There are three factors of production.
2. Land is a man-made resource.
3. Labour can be both physical and mental.
4. Labour is a passive factor in production.
5. The entrepreneur must take the decisions what, how, and where to produce.
3. Answer the questions.
1. What are “inputs”?
2. Does land include only the site of production?
3. Why is land considered a passive factor of production?
4. Is labour only a factor of production?
5. How do capital and labor differ from land?
6. Who takes decisions and risks in the process of production?
7. What are the entrepreneurial functions?
Vocabulary Focus
1. With the help of the text, translate into English the following words and
phrases.
создавать что-либо
играть важную роль
чётко отличаться от чего-л.
над или под землёй
сельскохозяйственное угодье
удовлетворять потребности и желания
принимать участие в производстве
46
созданный руками человека
простейшие орудия труда
принимать решения.
2. Find in the text synonyms to the words below.
- to make
- to help
- to take action
- natural reserves
3. Fill in the gaps with prepositions, if necessary.
1. My colleagues are carrying … research on business ethics.
a) out
b) on
c) away
2. We shared … the money equally.
a) out
b) between
c) 3. The meeting takes place … the hall every Friday.
a) at
b) in
c) on
4. The President was assisted … his advisers.
a) with
b) by
c) 5. I sometimes have difficulty distinguishing Spanish … Portuguese.
a) between
b) from
c) with
Talking Points
1. Explain why the factors of production are interdependent.
2. Consider the four factors of production that went into the making of any
book. Label each item: LD for land, LR for labor, C for capital, or E for
entrepreneurship.
1. trees _____
2. computers _____
3. publishing executive _____
4. salesperson _____
5. editor _____
6. petroleum _____
7. oil used for fertilizer _____
8. book presses _____
9. word processing specialist _____
10. typesetter _____
11. storage shelves _____
12. publisher’s building site _____
2. “An Entrepreneur”, according to the American Heritage Dictionary, is
“someone who organizes, operates, and assumes risk for business ventures.” In your
opinion, what some common traits of character do successful entrepreneurs share?
47
3. Is it possible to improve the efficiency of the factors of production? If yes, in
what way?
Summary Points
1. Read the text about factors of production once again. What is its main idea?
2. Divide the text into logically complete parts. Take notes on the most
important information each paragraph contains. Report it to the whole group.
48
UNIT 10
FORMS OF BUSINESS
Lead-in
1. Many people dream of having their own business. To see if starting a
business is right for you, you have to ask yourself some very important questions.
Your answers will help you determine if you are ready to become a small business
owner, what kind of business you want, what your target audience is, who your
competitors are, etc. Working with a partner, make a list of these questions.
2. Would you like to start your own business? What kind of business would it
be? What would your main business goal be?
3. What are the dangers of having your own business?
Key Vocabulary
Make sure you know the following words and word-combinations.
1. ownership n
2. vary v
3. partnership n
4. joint stock company
5. cooperative society
6. public corporation
7. enterprise n
8. assume risks
9. be responsible for
10. disadvantage n
11. liability n
12. carry on n
13. personal possessions
14. contribute v
15. stockholder n
16. mutual benefit
17. flow in
18. tax n
собственность, право собственности
меняться, варьироваться
товарищество
акционерное общество
кооператив
государственная корпорация
предприятие; предприимчивость, инициатива
принимать на себя риск
быть ответственным за
недостаток
ответственность
вести (дело)
личное имущество
сотрудничать, делать вклад
акционер
взаимная выгода
поступать (о деньгах)
налог
Pre-reading Activities
1. Study the following rules of word-building. Use the dictionary and tell what
parts of speech (части речи) these words are.
49
an owner 
a partner 
a proprietor 
ownership
partnership
proprietorship
liable 
responsible 
liability
responsibility
2. Complete the chart.
NOUN
VERB
liability
vary
ADJECTIVE
own
benefit
personal
disadvantage
Reading
Read the text carefully and do the tasks that follow.
A business (also known as enterprise or firm) is an organization designed to
provide goods or services. Although forms of business ownership vary greatly, there
are several common types: the sole proprietor, the partnership, the joint stock
company, the cooperative society, the public corporation, etc.
The sole proprietor is the simplest and the oldest form of business enterprise
and is often referred to as the one-person business. A single person provides the
capital, takes the decisions, and assumes the risks. He or she is responsible for the
success or failure of the business, and has, therefore, the sole rights to profits.
The great disadvantage of the sole proprietor is that the owner is personally
liable for the debts incurred by the firm and his liability is unlimited. All his personal
possessions are at risk.
Partnerships are voluntary combinations of from 2 to 20 persons formed for
the purpose of carrying on business with a view of profit. The motive, however, may
not be financial. Partnerships are often formed in order to bring new ability and
enterprise into the business. They are flexible organizations which allow a greater
degree of specialization, but the liability of the partners is unlimited and they are fully
liable for the acts of other partners.
The joint stock company consists of an association of people who contribute
towards a joint stock of capital for the purpose of carrying on business with a view of
profit. A change in membership or a transfer of stock has no effect on the existence of
the company. Unlike partners in a partnership, a stockholder in a joint stock company
has no agency relationship to the company or any of its members.
A cooperative is a business organization owned and operated by a group of
individuals for their mutual benefit. They are limited liability businesses that can be
50
for-profit or not-for-profit. Members often have a close association with the
enterprise as producers or consumers of its products or services, or as its employees.
Choosing the right form of business ownership is important because the form
of business you choose will determine how your business is organized, how the
money that flows in and out of your business is handled, and how your business is
taxed.
Comprehension Check
1. Read the text again and decide whether these statements are about the sole
proprietor, the partnership, the joint stock company, or the cooperative society.
1. This type of business is easy to organize, but it needs agreement; partners
receive all income and partners have unlimited liability.
2. This type of business is easy to organize, the owner has complete control and
receives all income.
3. In this type of business the owner has unlimited liability.
4. Such a company has some features of a corporation and some features of a
partnership. It sells fully transferable stock, but all shareholders have unlimited
liability.
5. This is a jointly owned commercial enterprise (usually organized by farmers
or consumers) that produces and distributes goods and services and is run for the
benefit of its owners.
2. Answer the questions.
1. What is the purpose of any business?
2. Do forms of business vary? What are they?
3. In what way is the sole proprietor often referred to?
4. Are there any disadvantages of sole proprietorship?
5. What are partnerships?
6. Is the motive of a partnership to make a profit?
7. Is the joint stock company the simplest and the oldest form of business
enterprise?
8. What are the characteristics of a cooperative?
9. Why is choosing the right form of business important?
3. Reproduce the context in which the following word-combinations are used.
common types
one-person business
an association of people
to take decisions
to be responsible for
to be liable for
to carry on business
51
-
to own and operate
benefit
profit
Vocabulary Focus
1. Complete the gaps choosing the right alternative.
1. In a partnership, the business is … by two or more people.
a) varied
b) assumed
c) owned
2. Every job has its … .
a) disadvantages
b) enterprise
c) tax
3. Demand for certain products … with the season.
a) contributes
b) flows in
c) varies
4. Mr Lee … many charities.
a) assumes risks of
b) contributes to c) flows in
5. He packed all his … into one bag.
a) possessions
b) ownership
c) liabilities
6. I didn’t get much … from this transaction.
a) responsibility
b) benefit
c) disadvantage
7. The baker has … business here for years.
a) varied
b) carried on
c) flown in
2. Look through the text once again and find the English equivalents.
предоставлять товары и услуги
несколько стандартных типов
быть ответственным за успех или неудачу
исключительное право на прибыль
нести персональную ответственность за долги
быть образованным с целью;
с целью ведения бизнеса
передача фондов
агентские (посреднические) отношения
коммерческий или некоммерческий
контролировать потоки денег
3. Change the words on the right to complete the sentences below.
1. He is the … of 2 houses.
ownership
2. You are … for the damage caused by your action.
responsibility
3. The … for this deal is yours!
responsible
4. An association of persons joined as partners in business is a …
partner
5. I’m proud to be his …!
partnership
6. He spent only his … money to buy this flat.
ownership
Talking points
52
1. The choice of the form of business or business organization depends on
various factors. Share your ideas about them.
2. Partnerships consist of two or more partners who are both responsible for the
business. They share assets, profits, liabilities, and management responsibilities for
running the business. Before making a decision concerning whether to have a partner
or not, it is better to prepare a "for" and "against" list. What are the most common
reasons for joining with another person to start the business? Discuss all the
advantages and disadvantages with your partner and make a "for" and "against" list.
3. In your opinion, do men or women make more successful business people?
Why?
Summary Points
1. Summarize the main idea of the text below.
There are numerous reasons that make people think about owning a business of
their own. Personal independence, unlimited profit potential, the opportunity to work
at something they really love are some of the reasons people have given for trying
entrepreneurship. Many business leaders begin their careers as entrepreneurs after
four years of undergraduate college training and even additional graduate school
training. Others become successful entrepreneurs without special training.
Many colleges now offer programs that teach students how to start and operate
a business. Basic information is combined with hands-on experience and the advice
of successful business consultants. These programs help potential entrepreneurs
decide whether their own ideas are good and how to follow through with them.
A common way to learn about business, and the opportunities for starting one
similar to it, is to learn while working for someone else. It provides a source of steady
income to people while they are planning to start their own businesses. About 50
percent of entrepreneurs start their businesses in industries in which they have some
experience.
2. Divide the text into logical parts and use appropriate vocabulary to make its
summary.
53
Unit 11
GOVERNMENT AND BUSINESS
Lead-in
Classify the tasks you consider to be governmental responsibilities in order of
importance.
- education
- health care
- working conditions
- social security
- defence
- public transport
Key Vocabulary
Study the following list of vocabulary.
1. interfere in smth \ intervene in smth
вмешиваться во что-л.
2. allow v
позволять, разрешать
3. responsibility n
ответственность
4. poverty n
бедность
5. essential adj
важнейший, необходимый
6. recreational facilities
места отдыха и развлечений
7. invest in smth
инвестировать, вкладывать
8. environment n
окружающая среда, окружение
9. free enterprise system
система
свободного
предпринимательства
10. government regulation
государственное регулирование
11. laissez-faire
невмешательство
12. tax breaks
налоговые льготы
13. fine-tune v
регулировать
14. inflationary adj
инфляционный
15. deep recession
глубокий спад
16. threaten v
грозить, угрожать
17. reduce v
сокращать, уменьшать, понижать
18. interest rate
процентная ставка
19. economic emergency
чрезвычайное
экономическое
положение
20. runaway inflation
безудержная инфляция
Pre-reading Activities
Translate the sentences into Russian. Mind the list of Useful Vocabulary.
54
1. If inflation threatens the US economy, the Federal Reserve System may
adopt policies that increase interest rates.
2. During a depression the government may try to increase demand by cutting
taxes so that people have more money to spend.
3. An essential part of economic freedom is freedom to use the resources we
possess in accordance with our own values.
4. In some countries producers don’t depend on the government regulations and
make all decisions themselves.
5. A mixed type of economy with a rather high degree of government
intervention is a feature of some developed countries, such as the USA, Canada,
Japan.
Reading
1. Read the text. Ask 4-5 questions about its contents and let the group answer
them.
To what extent should the government interfere in the economic system? On
the one hand, it can intervene minimally, allowing the forces of supply and demand
and the price mechanism to determine what goods and services are to be produced.
On the other hand, the government can make all major decisions such as what to
produce, how to produce and for whom to produce.
Most governments operate between these two extremes. But there are always
some things which are under the government’s control. For example, health care is a
sphere of a state responsibility in all civilized lands, as no one can be assigned to
illness or death because of poverty. The state has many other essential functions:
parks and recreational facilities, the police, libraries and others. By the way, to
support science is also the government’s responsibility. Together with this, it usually
invests in agricultural productivity, modern air transport, advanced information
technologies and the environment.
The USA points to its free enterprise system as a model for other nations. But
exactly how free is business in America’s free enterprise system? The answer is, not
completely, because a complex web of government regulations shapes many aspects
of business operations.
It is known that historically, the US government policy toward business was
summed up by the French term laissez-faire – “leave it alone”, but laissez-faire
practices haven’t prevented private interests from turning to the government for help
on numerous occasions, such as grants of land and public subsidies, protection
against strong competition, tax breaks and others.
As for the British government, it seeks to fine-tune the economy in order to
keep economic booms from becoming too inflationary and recessions from becoming
too deep. The British government often manages demand, intervening when demand
for goods and services is high enough to threaten inflation. In such cases the
government tries to reduce demand by raising interest rates and taxes. In economic
emergencies the government can control prices and incomes to a considerable extent,
55
but this is done only in extreme circumstances such as in times of war and runaway
inflation.
Comprehension Check
1. Agree or disagree with these statements about the text.
1. Sports care is a sphere of state responsibility in all civilized lands.
2. China points to its free enterprise system as a model for other nations.
3. A complex web of the US government regulations shapes many aspects of
business operations.
4. In economic emergencies the British government never controls prices and
incomes.
2. Find the paragraph, which gives the answer to the following question.
- What spheres of life are usually under the government control?
A. 1
B. 2
C. 3
3. Complete the sentences using the information from the text.
1. As for the British government, it seeks to ……… .
2. The state has many other essential functions: ……… .
3. On the other hand, the government can make ……… .
5. In economic emergencies the government can ……… .
Vocabulary Focus
1. Match the words on the left with their synonyms on the right.
1. essential
a. decrease
2. interfere
b. let
3. reduce
c. important
5. allow
e. regulate
2. Use the words from the list of Useful Vocabulary to complete the sentences.
1. The American ….. emphasizes private ownership.
a. deep recession
b. free enterprise system
c. interest rate
2. While most Americans would agree that ….. has an important role to play in
the economy, there is a considerable disagreement as to how active this role should
be.
a. government
b. environment
c. responsibility
3. People who ….. in education, gain profit in the form of knowledge.
a. interfere
56
b. invest
c. reduce
4. A serious, long-lasting ….. is called a depression or a slump.
a. inflation
b. increase
c. recession
5. In carrying out ….., the government uses a combination of monetary and
fiscal policies.
a. fine-tuning
b. laissez-faire
c. tax breaks
6. If a(n) ….. is lowered, businesses will borrow more from the banks, jobs will
be created, but prices might rise and that means inflation.
a. run-away inflation
b. government regulation
c. interest rate
3. Give the English equivalents to the following expressions.
- чрезвычайное экономическое положение
- налоговые льготы
- безудержная инфляция
- производить товары и услуги
- современные информационные технологии
- принимать решения
- поднять процентную ставку
- контролировать цены и доходы
Talking Points
1. Comment on the quotations.
1. “Which is the best government? That which teaches us to govern ourselves”.
Johann Wolfgang von Goethe
2. “That government is the best which governs least, because its people
discipline themselves”.
Thomas Jefferson
2. Express your opinion on the following issues.
1. To what extent should the government interfere in the economic system?
2. Some economists state that the government interferes in the economy too
much. Others say it should do more. What are your arguments for and against
government control? While answering this question, you may use the following
phrases.
- To my mind ………
- I think ………
- In my opinion ………
57
- On the one hand ………, on the other hand ………
Summary Points
1. Read the text and choose the most suitable title out of those given below.
A. Small Business in the USA.
B. The Role of the Government and Individuals in the American Economy.
C. The Mixed Type of the American Economy.
The American free enterprise system emphasizes private ownership. Private
businesses produce most goods and services, and almost two thirds of the output goes
to individuals for personal use.
However, there are limits to free enterprise system. Americans have always
believed that some services are better performed by public rather than private
enterprises. For example, in the US the government is responsible for the
administration of justice, education (although there are many private schools), road
system, and national defense. The American government also provides
unemployment benefits to people who cannot support themselves; it pays much of the
cost of medical care for those who live in poverty; it regulates private industry to
limit air and water pollution; it provides low-cost loans to people who suffer from
natural disasters; and finally, it has played the leading role in the exploration of
space, which is too expensive for any private enterprise to handle.
In the American economic system, individuals can help guide the economy
through the choices they make as consumers and through the votes they cast for
officials who shape economic policy. In recent years, consumers have voiced
concerns about product safety, environmental threats and potential health risks. The
government, in its turn, has responded by creating agencies to protect consumer
interests.
The US economy has recently changed in other ways as well. The labor force
has shifted to service industries. In today’s economy, there are much more providers
of services than producers of agricultural and manufactured goods.
Notes:
cast votes – голосовать
voice concern – выражать беспокойство
shift v– перемещать(ся), передвигать(ся)
2. Put down key words and expressions from each paragraph.
3. Summarize the text, basing on the key words and expressions you have put
down.
58
Unit 12
CORPORATE CULTURE
Lead-in
1. Split into groups. Within your group discuss the issues below. Share the
opinion of your group with the others.
1. How do you understand the term “corporate culture”?
2. What is the role of corporate culture in successful business?
2. Choose the factors which are influenced by corporate culture. Then comment
on your choice.
- communication in the company
- profit of the company
- planning
- decision-making
- image of the company
- management of the company
- size of the company
- personal relations in the company
- hobbies and interests of employees
- payment of work in the company
Key Vocabulary
Study the following list of vocabulary.
1. corporate culture
корпоративная
культура(свод
наиболее
важных
положений
деятельности
организации,
определяемых её миссией и стратегией
развития и находящих выражение в
совокупности социальных норм и
ценностей разделяемых большинством
работников)
2. belief n
вера, мнение, убеждение
3. staff n
штат служащих, персонал
4. govern v
управлять, править, руководить
5. behave v
вести себя, поступать
6. evolve v
развиваться, эволюционировать
7. employee n
служащий, работающий по найму
8. restrict v
ограничивать
9. solve a problem
решать проблему
10. perceive v
воспринимать, понимать, осознавать
11. perception n
восприятие, осмысление, осознание
59
12. background n
13. research n
14. encourage v
15. accuracy n
16. emphasize v
17. status quo
происхождение, биографические
данные, связи, окружение (всё, что
связано с жизнью человека)
исследование,
исследовательская
работа
поощрять, поддерживать в чём-л.
точность
придавать
особое
значение,
подчёркивать
статус-кво, существующее положение
вещей
Pre-reading Activities
1. Complete the table with missing words. Consult a list of Key Vocabulary and
a dictionary if necessary.
Verb
Noun
belief
perceive
government
solve
employ
behaviour
restrict
2. Translate the sentences into Russian. Mind the words from exercise 1.
1. People’s creativity is restricted by routine and traditional office hours.
2. Many governments cut advertising expenditures during poor economic
times.
3. A slogan is believed to express a key corporate value.
4. In recent years, there have been changes in employment, which have affected
practically all the work force.
5. It’s known that employee’s behavior influences the image of the company.
Reading
Read the text and be ready to speak about corporate culture and its
characteristics.
Corporate culture can be defined as a set of key values, beliefs, understandings
and norms shared by members of an organization. It represents the unwritten,
informal norms that bind the company staff together. Just as tribal cultures have rules
60
and taboos that dictate how members will act toward one another, modern
organizations have cultures that govern how their members should behave. In every
company, there are systems or patterns of values, symbols, rituals, myths, and
practices that have evolved over time. These shared values determine what
employees see and how they respond to their world. When confronted with a
problem, corporate culture restricts what employees can do by suggesting the correct
way – “the way we do things here” – to define, analyze and solve the problem.
Corporate culture is a perception, because individuals perceive the culture of
the company on the basis of what they see or hear within this company. Even though
individuals may have different backgrounds or work at different levels in the
organization, they tend to describe the organization’s culture in similar terms. That is
the shared aspect of culture.
Corporate culture is also a descriptive term, because it is concerned with how
members perceive the company and it is not concerned with the fact whether they
like it. So, corporate culture describes rather than evaluates.
Research suggests that there are 7 characteristics which cover the essence of an
organization’s culture.
1. Innovation and risk taking. The degree to which employees are encouraged
to be innovative and to take risks.
2. Attention to detail. The degree to which employees are expected to show
accuracy, analysis and attention to detail.
3. Outcome orientation. The degree to which managers focus on results or
outcomes rather than on the techniques and processes used to achieve those
outcomes.
4. People orientation. The degree to which management decisions take into
consideration the effect of outcomes on people within the organization.
5. Team orientation. The degree to which work activities are organized around
teams rather than individuals.
6. Aggressiveness. The degree to which people are aggressive and competitive
rather than easygoing and cooperative.
7. Stability. The degree to which company activities emphasize maintaining the
status quo in contrast to growth.
Comprehension Check
1. Agree or disagree with these statements about the text.
1. Corporate culture represents the unwritten, informal norms that bind the
company staff together.
2. Corporate culture evaluates rather than describes.
3. Research suggests that there are 10 characteristics which cover the essence
of an organization’s culture.
4. In every company, there are systems or patterns of values, symbols, rituals,
myths and practices that have evolved over time.
2. Answer the following questions.
61
1. How is corporate culture defined in the text?
2. Why is corporate culture considered to be a perception?
3. Why is corporate culture considered to be a descriptive term?
4. What are the characteristics which cover the essence of an organization’s
culture?
3. Choose the suitable title for the first paragraph of the text.
A. The shared values of corporate culture.
B. The definition of corporate culture.
C. The informal norms of corporate culture.
Vocabulary Focus
1. Match the words with their definitions.
1. corporate culture a. the existing state of affairs.
2. staff
b. a person’s social class, education, training, or experience.
3. background
c. a set of key values and beliefs shared by members of an
organization.
4. status quo
d. systematic investigation to establish facts or principles, or
to collect information on a subject.
5. research
e. a group of people employed by a company.
2. Use the words from the list of Useful Vocabulary to complete the sentences.
1. We use the term ….. to speak about a system of shared values that
distinguish this organization from other ones.
a. corporate culture
b. background
c. status quo
2. ….. are required to follow rules and regulations in this firm.
a. researchers
b. governments
c. employees
3. They have their own interest in maintaining the ….. .
a. accuracy
b. perception
c. status quo
4. She joined the ….. as an accountant.
a. corporate culture
b. staff
c. research
5. Nothing will change my ….. in a promising future of our company.
a. believe
b. belief
c. perceive
62
6. Mr. Black has the right ….. for this position.
a. background
b. perception
c. behavior
3. Give the English equivalents to the following expressions.
- система ценностей
- решить проблему
- иметь разное происхождение
- сущность корпоративной культуры
- быть конкурентоспособным
- поддерживать статус-кво
Talking Points
1. Give your arguments for or against the following statements.
1. Corporate culture is especially important for top managers.
2. Corporate culture helps to improve quality management (управление
качеством).
3. It’s impossible to change an organization’s culture.
2. Imagine you have got your own company. Describe an effective corporate
culture you would like to have in it.
3. Finish the phrase.
- A strong corporate culture helps ….. .
Summary Points
1. Read the passage and divide it into 3 paragraphs.
Although all organizations have their own cultures, not all cultures have an
equal influence on employees. Organizations where the key values are widely shared
have strong cultures. The more employees accept the organization’s key values, the
stronger the culture is. Employees in firms with strong cultures are more committed
to their firms than employees in firms with weak cultures. Moreover, strong cultures
are associated with high performance of organizations. Whether an organization’s
culture is strong, weak, or somewhere in between, depends on the intensity with
which the culture was originated. It is necessary to remember that organizations
where the key values are intensely held and widely shared have strong corporate
cultures.
2. Choose from the list A-D the sentence which best summarizes each
paragraph (1-3) of the passage. There is one extra sentence which you don’t need to
use.
A. The main characteristics of strong cultures are: shared key values,
employees’ commitment to their firm and high performance of the organization.
63
B. Any organization has its own corporate culture.
C. The cultures of some organizations encourage employees to take risks.
D. The intensity with which the culture was originated plays the most important
role.
3. Summarize the passage, basing on the sentences from Task 2.
64
Unit 13
EMPLOYMENT
Lead-in
1. In your opinion, which factors below are important for getting a job?
Choose the five most important. Is there anything missing from the list?
- age
- appearance
- contacts and connections
- experience
- handwriting
- hobbies
- marital status
- qualifications
- references
- blood group
- personality
2. Share your thoughts with the whole group on the following points.
1. Is employment a social issue or a political one? Explain your choice.
2. Do you believe that obtaining a good job today is easier or more difficult
than in your parents’ day? Why?
Key Vocabulary
Study the following list of vocabulary.
1. full employment
полная занятость
2. part-time employment
неполная занятость
3. informal employment
неофициальная,
неформальная
занятость
4. job-sharing
разделённая ставка, деление рабочего
места
между
несколькими
работниками
5. teleworking n
дистанционная работа, выполнение
рабочих функций в дистанционном
режиме
6. employable citizen
трудоспособный гражданин
7. availability n
доступность,
возможность
использования
8. casual adj
нерегулярный, бессистемный
9. illegal activity
нелегальная, незаконная деятельность
10. employer n
наниматель, работодатель
65
11. coworker n
12. supervision n
13. effective adj
14. satisfaction n
15. sense of security
16. pension scheme
17. sick-pay scheme
18. skill n
19. creativity n
сослуживец, коллега, напарник
контроль, наблюдение, управление
эффективный, действенный,
результативный
удовлетворение, удовлетворённость
чувство безопасности
пенсионный
план,
система
пенсионного обеспечения
система выплаты пособия по болезни
умение, навык
творчество, креативность
Pre-reading Activities
Translate the sentences into Russian. Mind the list of Useful Vocabulary.
1. My employer is a very generous person; he gives us all a big present at
Christmas.
2. If you wish me to attend an interview, I am available at any time.
3. My new job requires a lot of skills in the IT sphere.
4. Our boss invited us to participate in a job-sharing scheme.
5. The work of a software developer can be tiring, but it demands a lot of
creativity and brings a lot of satisfaction and positive emotions.
6. Many professional persons get a large amount of job satisfaction and a high
income.
Reading
1. Read the text and focus on types of employment and the main reasons for
working.
When we speak about employment we usually mean paid work done by a
person or a group of people. There are different types of employment nowadays.
The main goal of economy is full employment, which means availability of
jobs for all employable citizens.
Nowadays a lot of people work part-time; they perform their professional
duties during a part of the regular working time. There has been a huge rise in parttime jobs of all kinds, ranging from the unskilled office cleaners to the highly skilled
computer consultants.
There is also job sharing. This is a practice of dividing a full time job between
two people so that each works for half the time.
We can also mention informal employment, or paid work on a casual basis.
Jobs are often irregular, and workers are self-employed without earning pensions and
without paying taxes. This sort of employment is common in urban areas of
developing countries. It may involve service jobs as well as craft industries.
With technological advances more and more people telework. It means
working away from the employer’s office, often at home, but maintaining close
66
contact with coworkers and managers using computers and IT. In some situations
teleworking can increase an employee’s productivity; it also decreases the time they
spend driving to and from work and at the same time decreases pollution from cars.
But some managers feel uncomfortable with the lack of direct supervision they have
over their teleworking employees, and some employees may dislike teleworking
because of isolation from coworkers.
But why do people work? This question is important for business. The
management of any business must try to understand why people work and provide the
right motivation to make them work more effectively.
Of course, one of the main reasons for working is money. People work to get
enough money to satisfy their basic needs. But money isn’t the only motivation.
Belonging to a group is also a strong motivation for working people. A sense of
security is another human need for most people, that is why employers try to provide
different pension and sick-pay schemes.
One more strong motivation for people is a sense of self-importance. To work
efficiently, people want to feel their importance and necessity. Only in this case they
will have job satisfaction – a sense that you are doing something you really want to
do using all your skills and creativity.
Comprehension Check
1. Agree or disagree with these statements about the text.
1. There is one type of employment nowadays.
2. The main goal of economy is full employment.
3. Nowadays a lot of people perform their professional duties during a part of
the regular working time.
4. Job-sharing is a practice of dividing a full time job between two people so
that each works for half the time.
5. With technological advances few people telework.
6. Money is not one of the main reasons for working.
2. Choose the answer (A, B or C) which you think fits best according to the text.
1. How many types of employment are mentioned in the text?
A. 4
B. 5
C. 6
2. What reasons for working are mentioned in the text?
A. money, belonging to a group, a sense of security, a sense of self-importance
B. money, belonging to a group, a sense of winning, a sense of development
C. money, a sense of satisfaction, happiness, creativity
3. Complete the sentences using the information from the text.
1. Full employment means ….. .
2. Job-sharing is a practice of ….. .
3. The management of any business must try to understand ….. .
4. People work to get enough money to ….. .
5. Job satisfaction is a sense that ….. .
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Vocabulary Focus
1. Match the words on the left with those on the right. Then translate the
expressions into Russian.
1. job
a. employees
2. employable
b. jobs
3. job
c. sharing
4. work
d. citizens
5. teleworking
e. satisfaction
6. irregular
f. effectively
2. Use the words from the list of Useful Vocabulary to complete the sentences.
1. He is ….., that’s why he only goes to the office one day a week.
a. teleworking
b. coworker
c. creative
2. One of the most difficult decisions is choosing what to do for a ….. .
a. living
b. work
c. satisfaction
3. Most people are much more creative than their ….. realize.
a. skills
b. employers
c. jobs
4. When she is 55, she will be able to give up work and live on her ….. .
a. creativity
b. employment
c. pension
5. Sick-pay and pension schemes are the basic things which provide employees
with a ….. .
a. sense of responsibility
b. sense of security
c. sense of self-importance
3. Give the English equivalents to the following expressions.
- работа на нерегулярной основе
- профессиональные обязанности
- типы занятости
- платить налоги
- городская местность
- развитые страны
- увеличить производительность
- руководство предприятия
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- работать эффективно
- удовлетворять нужды
Talking Points
1. Comment on the quotations.
1. It doesn’t matter what job you do. It matters how you do it.
2. I would rather be a happy dustman than an unhappy millionaire.
2. Which of the following is (was) the most important to you when deciding on
a career? Rank the points, then discuss it with your groupmates.
- long-term career prospects
- personal satisfaction
- good payment
- opportunity to travel
- using your initiative
- chance to meet a lot of people
3. In pairs, discuss the following questions.
1. Are you sure /unsure about your career path? Why?
2. Are you optimistic/pessimistic about your prospects? Why?
3. Do you want to be self-employed or work as an employee? Why?
Summary Points
1. Read the text and choose the most suitable headline out of those given below.
A. Importance of Job Interviews.
B. Problems at Job Interviews.
C. Basic Types of Job Interviews.
D. Psychological Aspect of Job Interviews.
Job interviews can generally be divided into 3 main types. The first is called the
“traditional interview”. This is usually a series of standard questions about
qualifications, work experience, knowledge and expectations. Here you have a list of
quite traditional questions, like “What duties did you have in your previous job?”
This is still the model for a lot of interviews today.
Then there is the “case interview” which is very challenging. Here the
interviewer presents a problem and then asks questions to find out how the candidate
would solve the problem. The “case interview” puts candidates in a pretty
uncomfortable position because they are asked to do different things – to demonstrate
that they can analyze the problem logically, and communicate effectively with the
interviewer.
The third type is known as the “behavioural interview”. Its task is to find out
how candidates behave in certain situations. A typical question here may be “Can you
give me an example of a situation where you had to follow orders that you didn’t
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agree with?” The answers to such questions disclose a lot of information and the
interviewer can see more of the interviewee.
2. Put down key words and expressions from each paragraph.
3. Summarize the text, basing on the key words and expressions you have put
down.
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Unit 14
GLOBALIZATION
Lead-in
1. Choose the variant which best defines the word “globalization”. Then
explain your choice.
A. the process of exchanging information, ideas or feelings
B. the process enabling financial and investment markets to operate
internationally, largely as a result of deregulation and improved communication
C. the process enabling people to cut their expenses and economize
2. Divide into 2 groups. Try to find some advantages and disadvantages of
globalization. Then exchange your ideas.
Key Vocabulary
Study the following list of vocabulary.
1. business n
зд. – промышленное или торговое
предприятие, фирма, компания
2. free trade
свободная торговля
3. prosperity n
процветание, преуспевание
4. less-developed country
слаборазвитая страна
5. developing country
развивающаяся страна
6. developed country
развитая страна
7. opportunity n
шанс, возможность, перспектива
8. major adj
главный, более важный, значительный
9. protect v
защищать, охранять
10. promote v
продвигать
11. living standard
жизненный уровень
12. welfare n
благосостояние,
благополучие,
социальное обеспечение
13. cross-cultural problems
межкультурные,
межэтнические
проблемы
14. issue n
вопрос, проблема
15. malnutrition n
недоедание, недостаточное питание
Pre-reading Activities
Translate the sentences into Russian. Mind the list of Useful Vocabulary.
1. Consortium is a group of companies in similar businesses working together.
2. Some people believe that free trade between nations can offer prosperity and
growth for all countries and businesses.
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3. India is the world’s major exporter of IT services.
4. Many economists from developed countries believe that globalization may
be the explanation for key trends in the world economy.
5. Those who support anti-globalists say that globalization provokes crosscultural problems in the world.
Reading
Read the following text and answer the questions that follow it.
Globalization is a word which has existed since the 1960s and it is on
everyone’s lips these days from politicians to businessmen. The term “globalization”
is used to describe certain processes in the world today. Globalization is defined as
the process enabling financial and investment markets to operate internationally,
largely as a result of deregulation and improved communication.
The accelerating pace of globalization is having a profound effect on life both
in rich and in poor countries.
Of course, many governments and businesses see a lot of advantages in the
process of globalization. They believe that increasing free trade between nations will
offer prosperity and growth for all countries and businesses. Globalization, they state,
has already brought many benefits: global food production has risen steadily over the
last years and malnutrition rates have fallen accordingly; citizens in less-developed
countries have access to health care which is often supplied by foreign businesses.
For companies globalization means increasing the number of countries of
operation. For example, British Petroleum (BP) is probably the most global company
in the world. It is interesting to see that in the USA its nationality has begun to
disappear. Almost everybody in the US says BP, and not British Petroleum. It’s a
local kind of company.
So, for its supporters, globalization offers an opportunity rather than a threat.
The leaders of the world’s major economies and big businesses are committed to
protecting and promoting global commerce and trade. They believe that the world is
moving towards an era of global markets and global companies.
Together with this, anti-globalists emphasize that globalization threatens the
environment as well as national cultures – they predict that it will make the rich
nations richer and the developing countries poorer. Among other disadvantages of
globalization there are such points as:
- It can lead to big employment problems.
- It lowers people’s living standards.
- It prevents governments from controlling their welfare systems.
- It creates cross-cultural problems between the East and the West.
As we can judge, nowadays globalization is a controversial issue for businesses
and governments all over the world. But it goes without saying that it’s also an
important issue for the 21st century, which will continue to be the subject of debate
among those who oppose, support or simply observe it.
Comprehension Check
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1. Answer the following questions.
1. How is globalization defined in the text?
2. What advantages do businesses and governments see in the process of
globalization?
3. What disadvantages do anti-globalists emphasize?
4. What other disadvantages of globalization are mentioned in the text?
2. Complete the sentences using the information from the text.
1. For companies globalization means ….. .
2. For its supporters globalization offers ….. .
3. The term “globalization” is used to describe ….. .
4. The world is moving towards an era ….. .
5. Globalization prevents governments from ….. .
3. Summarize all the advantages and disadvantages of globalization given in
the text. Can you add any others?
Vocabulary Focus
1. Match the words with their definitions.
1. free trade
2. prosperity
3. living standard
4. developing
country
5. malnutrition
a. success or wealth.
b. a country that is seeking to become more advanced
economically and socially.
c. international trade that is free of such government
interference as import quotas, export subsidies, and
protective tariffs.
d. lack of adequate food.
e. level of comfort in which people live, which usually
depends on how much money they have.
2. Use the words from the list of Useful Vocabulary to complete the sentences.
1. As a result of ….. many businesses trade throughout the world.
a. malnutrition
b. globalization
c. promotion
2. Governments are planning to expand the global economy by …..trade and
economic interdependence.
a. promoting
b. fighting
c. economizing
3. International furniture retailer IKEA announced that it will ….. the world’s
ancient forests.
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a. trade
b. supply
c. protect
4. Cheaper housing would improve the ….. of ordinary people.
a. living advantages
b. living disadvantages
c. living standards
5. The police have made no attempt to solve these ….. .
a. standards
b. issues
c. businesses
6. The supporters of globalization state that it will lead the world to economic
….. .
a. trade
b. prosperity
c. opportunity
3. Give the English equivalents to the following expressions.
- угрожать окружающей среде
- продвигать торговлю
- финансовые и инвестиционные рынки
- видеть много преимуществ
- иностранное предприятие
- создавать межкультурные проблемы
Talking Points
1. Comment on the quotations.
1. “It has been said that arguing against globalization is like arguing against the
law of gravity”.
Kofi Annan
2. “Globalization is a fact of economic life”.
Carlos Salinas de Gortari
2. Express your opinion on the following points.
1. Globalization: is it good or bad? Why?
2. What is your opinion about the future of the process of globalization?
3. Finish the phrase.
- I would (not) like to live in the era of globalization, because ….. .
Summary Points
1. Look through the text from Reading and fill in the missing parts of its plan.
I. The definition of globalization.
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II.
III. The disadvantages of globalization.
IV.
2. Put down key words for each point of the plan.
3. Summarize the text, basing on the key words you have put down.
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Unit 15
THE FIRST MODERN ECONOMISTS
Lead-in
1. Can you name any well-known economists? What were they famous for?
2. Who got the epithet «the father of economics»?
Key Vocabulary
1. Study the following list of vocabulary.
1. merchant n
купец, торговец; лицо, занимающееся
торговлей
2. compete v
конкурировать, состязаться, соревноваться
3. wealth n
богатство, состояние
4. object v
возражать, протестовать; выдвигать
возражения
5. outperform v
превосходить; выполнять лучше (кого-л.)
6. invisible hand
«невидимая рука» (рыночный механизм,
автоматически осуществляющий
регулирование хозяйства в условиях
свободной конкуренции)
7. benefit the society
помогать, приносить пользу обществу
2. Mind the following common nouns.
1. mercantilist n - меркантилист (сторонник меркантилизма, системы
взглядов на вопросы экономической политики, господствовавшей в 16 – 18 вв.)
2. physiocrat n - физиократ (представитель французской школы
политической экономики в 18 веке)
Pre-Reading Activities
1. Use a dictionary and match the synonyms. Mind the use of the prepositions.
i) to outperform somebody
a) to oppose something
ii) to object to something
b) a seller
iii) to compete with somebody
c) to surpass somebody
iv) a merchant
d) to rival somebody
Reading
Read the text and assimilate its information.
Between the 16th and 18th centuries the major countries of Europe believed in
the economic theory of mercantilism. Mercantilists claimed that nations should
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behave as if they were merchants competing with one another for profit and like
merchants, nations should protect business and industry.
But for a group of 18th-centuary French philosophers and economists, the
suggestion that nations should protect their own business and industry made no sense
at all. Those were the physiocrats. They claimed that the products of agriculture and
other natural resources were the true source of wealth. In other words, since real
wealth came from the land, it followed that the best thing the government could do
would be to keep its hands off business and let nature take its course. This idea was
expressed in the slogan «laissez faire», (let people do as they choose).
The year of 1776 became very significant for
the development of the world economic thought, as
one of the most influential scientific works, The
Wealth of Nations, written by Adam Smith, the father
of economics, was published. The author objected to
the principal economic beliefs of his day. He
disagreed both with the physiocrats and mercantilists.
In Smith’s view, the nation’s wealth depended on
production, not agriculture alone.
The heart of Smith’s economic philosophy was
his belief that the economy would work best without
any government regulation. In this case, self-interest
would lead companies to produce only those products that consumers wanted, and to
produce them at the lowest possible cost. They would do this to outperform their
competitors and gain the greatest profit. He believed that self- interest would benefit
the society as a whole by providing it with more and better goods and services at the
lowest prices. To explain why the society benefits when the economy is free of
regulation, Adam Smith used the term «invisible hand», meaning the economic forces
that today are called supply and demand.
In his work «The Wealth of Nations» Adam Smith sounds realistic and
practical, respectful of the classical past but at the same time dedicated to the great
discovery of his epoch – progress. Although he was writing for his generation, his
thoughts and ideas have always attracted the attention of all economists, that is why
Adam Smith has remained a significant figure in the history of economic thought for
more than 2 centuries.
Comprehension Check
1. Complete the following sentences.
1. The economic theory of mercantilism … .
2. Some French philosophers and economists claimed that … .
3. … in 1776.
4. A. Smith objected to … .
5. According to Smith, … .
6. Adam Smith used the term «invisible hand» to … .
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2. Answer the questions.
1. What was the difference between mercantilists’ and physiocrats’ views?
2. What idea was expressed in the slogan «laissez faire»?
3. Why did the year of 1776 become very significant for the development of the
world economic thought?
4. Who is considered to be the father of economics?
5. What theories formed the core of Smith’s philosophy?
6. Why has Adam Smith remained a significant figure in the history of
economic thought?
3. Read the text once more and explain the meaning of the phrases below.
“balance of trade”
“laissez faire”
“invisible hand”
Vocabulary Focus
1. Provide appropriate English equivalents of the following collocations.
- бороться (конкурировать) за прибыль
- поддерживать промышленность
- природные ресурсы
- источник состояния
- правительственное регулирование
- производить те товары, которые нужны потребителям
- превзойти конкурентов
- предоставлять товары и услуги по самым низким ценам
- история экономических учений.
2. Fill in the prepositions, if necessary. Translate the sentences into Russian.
1.
Free market system allows businesses to compete … profit with a
minimum of government interference.
a) for
b) with
c) on
2.
There are several reasons why I object … joining you.
a) with
b) to
c) 3.
The production of this equipment depends … demand.
a) in
b) on
c) at
4.
Our company can provide goods or services … a low cost.
a) at
b) on
c) of
5.
You will gain … no profit by resistance.
a) by
b) in
c) 3. Use the vocabulary of the text to complete these sentences.
1.
An individual who buys products or services for personal use and not for
manufacture or resale is …
a)
a consumer
78
b)
a merchant
c)
an exporter
2.
In economics, … is the amount of goods and services by a firm, industry,
or country.
a)
trade
b)
output
c)
profit
3. A fundamental economic concept that describes the total amount of a
specific good or service that is available to consumers is …
a)
demand
b)
supply
c)
a law
4.
Adam Smith saw the creation of … as the combination of materials,
labor, land, and technology in such a way as to gain profit.
a)
costs
b)
society
c)
wealth
5.
The Peugeot engine has … its competitors this season.
a) competed
b) benefited
c) outperformed
6. I didn’t want to … him or his company.
a) rival
b) compete
c) produce
Talking Points
1. Economic thought may be roughly divided into three phases:

Premodern (Greek, Roman, Arab);

Early modern (mercantilists, physiocrats);

Modern (since Adam Smith in the late 18th century).
What new facts have you learnt about it from the text? Can you add anything
else?
2. Comment on the quotation.
“Labor was the first price, the original purchase - money that was paid for all
things. It was not by gold or by silver, but by labor, that all wealth of the world was
originally purchased.” Adam Smith.
Summary Points
1. What is the basic topic of the text about first economists?
79
2. Draw up an outline of the text and give a one-sentence summary of each
point.
3. Add some important information and make a conclusion: What have you
learned from the text? Have you found it informative/ helpful/ interesting?
80
SUPPLEMENTARY READING
Unit 1
Economics as a Science
The Business Cycle
The business cycle or trade cycle is a permanent feature of market economies:
gross domestic product (GDP) fluctuates as booms and recessions succeed each
other.
During a boom, an economy (or at least part of it) expands to the point where
it’s working at full capacity, so that production, employment, prices, profits,
investment and interest rates tend to rise.
During a recession, the demand for goods and services declines and the
economy begins to work at below its potential. Investment, output, employment,
profits, commodity, share prices and interest rates generally fall. A serious, longlasting recession is called a depression or a slump.
The highest point on the business cycle is called a peak, which is followed by a
downturn or a period of contraction. Economists sometimes describe contraction as
“negative growth”.
The lowest point on the business cycle is called a trough, which is followed by
a recovery or an upturn or a period of expansion.
There are various theories as to the cause of business cycle. Internal (or
endogenous) theories consider it to be regular and indefinitely repeating. When
economic times are good and people feel good about the future, they spend their
money. If people are worried about the possibility of losing their jobs in the near
future they tend to save more.
External (or exogenous) theories, on the contrary, look for causes outside
economic activity: scientific advances, natural disasters, elections or political shocks,
demographic changes, and so on.
Notes:
gross domestic product (GDP) – валовой внутренний продукт (ВВП)
fluctuate – колебаться, быть неустойчивым
recession – спад, снижение
downturn – экономический спад, понижение
upturn – подъём, рост
trough – самый низкий уровень экономической активности, низшая точка
(цикла)
endogenous theory – эндогенная (внутренняя) теория
exogenous theory – экзогенная (внешняя) теория
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Unit 2
Microeconomics and Macroeconomics
Macroeconomic Models
A macroeconomic model is an analytical tool designed to describe the
operation of the economy of a country or a region. These models are usually designed
to examine the dynamics of aggregate quantities such as the total amount of goods
and services produced, the total income earned, the level of employment of
productive resources, and the level of prices.
The goal of a macroeconomic model is to replicate the main mechanisms of an
entire economic system, which may consist of a region (such as the Italian
Mezzogiorno), a nation state (such as Poland), or a collection of nation states (such as
the 27 members of the EU). The only requirement is that the entity being modeled is
large enough to display the distinctive properties that are the subject area of
macroeconomics. Of course, it is also possible to construct economic models of other
entities, such as a town, a transport system, a cluster of firms, the operation of a
particular policy program, etc. However, such models fall outside the category of
macroeconomic models.
Macroeconomic models may be logical, mathematical, and/or computational;
the different types of macroeconomic models serve different purposes and have
different advantages and disadvantages.
Macroeconomic models may be used to clarify and illustrate basic theoretical
principles; they may be used to test, compare, and quantify different macroeconomic
theories; they may be used to produce "what if" scenarios (usually to predict the
effects of changes in monetary, fiscal, or other macroeconomic policies); and they
may be used to generate economic forecasts. Thus, macroeconomic models are
widely used in academia, teaching and research, and are also widely used by
international organizations, national governments and larger corporations, as well as
by economics consultants and think tanks.
Notes:
tool – инструмент
to replicate – воссоздавать
distinctive properties – отличительные черты, свойства
forecast – прогноз
think tank – экспертно-аналитический центр
Unit 3
Types of Economic Systems
A Consumer Economy
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A consumer economy refers to an economic system that primarily runs on
consumers' spending. In the USA, it is often said and also often disputed that
consumers are responsible for 70% of all spending and, therefore, this class of
spenders must be constantly stimulated to make money for businesses. There are
other classes of spenders that represent a lower amount of spending and are usually
ignored by attempts to revitalize the economy. In this economy, some financial
experts say consumption is required, while others say production is required to keep
the consumer economy satisfied.
A consumer economy simply means that there is an economy where consumers
dominate the spending sphere. Instead of businesses, government, pharmaceutical or
other spenders, consumers dominate the spending world. For this type of economy to
work, consumers must be stimulated to buy products, and products must be produced.
To stimulate purchases, the government will usually offer larger tax returns so
consumers have more money to spend, which will give businesses more capital so
they can create more jobs.
The main principle of a consumer economy is that the consumer must
consume. Products must be purchased and used for the economy to function. This
economy is so heavily dependent on the cycle of consumption that it can easily break
if the consumer refuses to spend money and chooses instead to invest it. To this end,
consumers are often given extra money to spend on products to drive the economy.
Most other spenders, such as businesses and manufacturers that purchase supplies,
often go ignored by these stimulus attempts because they represent a lower
percentage of overall spenders.
Others believe a consumer economy is not about consumption but production.
If the right product is made, the consumer will purchase it and a variety of different
products must be made to satisfy consumer demands. If production stops, there will
be nothing to consume, which is what leads many financial experts to state that
production is the driving force of a consumer economy.
Notes:
spender – лицо, осуществляющее расходы
to revitalize – восстановить активность
Unit 4
Scarcity and Choice
The Web as a Sales Tool
There is discussion today about how beneficial the Web is as a sales tool.
Many companies, even those with a tremendous presence on the Web, are not making
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a lot of money. They are positioning themselves for the future, with hopes that
buying on-line will become an everyday event.
The question that must be answered is whether the World Wide Web will
remain a place of information, or evolve into a profitable marketplace for businesses.
Actually, if you trace the history and growth of the Internet, you will realize
that extraordinary progress has been made. In the last decade, the number of personal
computers has multiplied to the point that potential sellers of products and services
now see tens of millions of customers to whom they can market their products. As
consumers become more relaxed and secure about buying on-line, market potential
will rise. Because of this potential, banner ads are everywhere: on Home Pages,
magazines or “webzines”. “Cyberstores” offer everything from automobiles to
vacation cruise.
The most successful sellers are those that mainly transact business by phone,
selling a product that does not have to be present physically. If you know the title or
the author of a book you want to buy, it is easier to order it by computer than to go to
the bookstore. Besides, you may get a discount, or save sales tax, even though you
have to pay for shipping.
An example of growing use of Web technology is the “Extranet”, which is a
company’s private link with its corporate customers. (The “Intranet” is the
company’s internal network with its employees.) General Electric, the most
successful example of extranets, grosses over a billion dollars a year in sales.
Notes:
to remain – оставаться
to transact – вести переговоры
link – канал связи, связующее звено
Unit 5
Demand and Supply
Import and Export
In the recent decade, the world has seen an international trade boom unlike any
other in history. Most large corporations earn a great portion of their revenues from
their overseas ventures. And many nations owe a large share of their gross national
product to the output of firms based beyond their borders.
In the age when many business people are thinking globally, it is just as
important to understand the working of the world economy as it is to understand our
national economy. Fortunately, the same concepts of supply and demand, deficit and
surplus also apply to international business. They just manifest themselves
differently.
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There are two sides to every trade relationship: buying and selling goods. In
international trade, those who buy are importing goods or services from foreign
sources; those who sell are exporting products to customers abroad.
The main difference between domestic trade and international trade is the use of
foreign currencies to pay for the goods and services crossing international borders.
Although global trade is often added up in euros and US dollars, the trading itself
involves various currencies.
Whenever a country imports or exports goods and services, there is a resulting
flow of funds: money returns to the exporting nation, and money flows out of the
importing nation. Trade and investment is a two-way street, and with a minimum of
trade barriers, international trade and investment usually makes everyone better off.
The balance of trade (the import-export balance) is determined by the relationship
between import and export.
In an interlinked global economy, consumers are given the opportunity to buy
the best products at the best prices. By opening up markets, a government allows its
citizens to produce and export those things they are best at and to import the rest,
choosing from whatever the world has to offer.
Notes:
overseas ventures – иностранные компании, предприятия
domestic trade – внутренняя торговля
currency – валюта
better off – обеспеченный, состоятельный
balance of trade – торговый баланс
Unit 6
Opportunity Cost
A University Education and Opportunity Cost
Unlike most costs discussed in economics, an opportunity cost isn’t always a
number. The opportunity cost of any action is simply the next best alternative to that
action. Economists believe that opportunity costs play a fundamental role in people’s
lives. For example, many school-leavers consider going to Universities for four or
five years after finishing schools. What is the cost of acquiring a University
education?
Obviously, the cost of tuition, the cost of books and other supplies, and the
cost of living in a hostel represent the money cost of going to University. The other
uses of this money might have been put to represent its opportunity costs. But what
else is a cost of going to University? If a student didn’t go to University, then he or
she would most likely find a job instead.
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The money that those who choose University might have earned during their
years of study is described by economists as foregone earnings. Foregone earnings
represent another, very important cost of a University education.
Thus, the opportunity cost of going to University is the goods and services
represented by the money cost of the education, plus the value of the foregone
earnings.
Notes:
tuition – обучение
foregone earnings – упущенные заработки
Unit 7
Money
The System of Cheques in Britain
Money is any object or record that is generally accepted as payment for goods
and services and repayment of debts in a given country or socio-economic context.
So, bank-notes and coins are not the most important form of money in developed
economies.
In the United Kingdom about 90% of all transactions are settled by means of
cheques. But cheques themselves are not money; they are orders to bankers to
transfer money from one person to another. The money transferred in this way
consists of bank deposits. If there is no money in the form of a bank deposit then any
cheques drawn on that account will be worthless.
Cheques were used as early as the second half of the 17th century, but they did
not come into general use until the second half of the 19 th century. The Bank Charter
Act of 1844 put strict limitations on the note issue at a time when the output of goods
and services was expanding rapidly. The need for an expansion of the money supply
to keep pace with increasing output greatly stimulated the use of bank deposits.
This most developed form of money (bank deposit) consists of entries in the
bank ledgers, or more likely nowadays, of records on computer tapes. The greater
part, in value terms, of the payments made each day are carried out by adjustments
made to the totals in different bank deposits. A payment from one person to another
merely requires that the banker reduces the amount in one deposit and increases in
another. Transferring money, therefore, has become little more than a kind of
bookkeeping exercise, the money itself does not consist of some physical tangible
commodity.
Notes:
to transfer – переводить (о деньгах)
to come into use – начинать употребляться
to keep pace with – не отставать от
entry – запись
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ledger – главная книга (в бухгалтерии)
bookkeeping – бухгалтерия
Unit 8
Markets and Prices
Market Research
Millions of pounds are spent each year on market research. Nearly 10% of the
price we pay for goods in the shops is spent on it.
What is market research? By definition, it is a systematic collection and
analysis of data, which is based on the customer’s attitude, needs, opinions and
motivation within the context of political, economic and social influences. Market
research is always necessary, because to reduce risk, any organization needs to know
about the market for a product or service it is going to launch.
Market research makes a positive contribution to business by helping in the
decision-making process. There are many different types of market research. Here are
the main ones:
1. Market and sales research. It estimates the size of new markets and their
potential growth, identifies market segments and trends.
2. Product research. Its purpose is to investigate the customer’s attitude to
new products, to find alternative uses for existing products and to generate new ideas
for new products.
3. Research on promotion and advertising. It helps to choose the right
advertising medium, analyses the effectiveness of advertising and evaluates present
sales techniques.
The market research process is a five-step application of the scientific method
that includes:
1. Defining the problem.
2. Analyzing the situation.
3. Getting the necessary data.
4. Processing the data.
5. Solving the problem.
As for the information a marketing researcher is interested in, there exist its 3
main sources:
1. Information within the company, such as sales figures, is known as internal
information.
2. Information external to the company, such as government reports or
published marketing reports, is known as secondary information.
3. The third information source, often characterized by market research
opinion polls, is known as primary information.
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Notes:
launch – выпускать на рынок (товар или услугу)
Unit 9
Factors of Production
Labour
Labour, in economics, is some effort necessary to satisfy human needs. It is
one of the three leading elements in production, the other two being land (natural
objects) and capital.
In industry, labour has a great variety of functions, which may be classified as
follows: production of raw materials, as in mining and agriculture; manufacturing in
the widest sense of the word, or transformation of raw materials into objects
serviceable to humans; distribution, or transference of useful objects from one place
to another, as determined by human needs; operations involved in the management of
production, such as accounting and clerical work; and personal services such as those
rendered by physicians and teachers.
Many economists distinguish between productive and unproductive labour.
Productive labour consists of those kinds of exertion that produce utility embodied in
natural objects. Unproductive labour, like that of the musician, is useful but does not
add to the material wealth of the community. As a result of the Industrial Revolution
at the end of the 18th century, most workers were employed in large factories and
similar undertakings. Those workers were not protected from economic exploitation
or from the consequences of illness, disability, or unemployment. In the early decades
of the 19th century, increasingly prevalent ideas of freedom caused great changes in
the conditions of labour. Workers began to form trade unions and cooperative
societies that enabled them to participate in many types of political activities and to
protect themselves by political and economic means. Laws for the regulation of
labour are now intended not to fix wages as formerly, but to protect the workers.
Notes:
raw – сырьевой
exertion – усилие, физическая нагрузка
utility – польза, полезность
conditions – условия
Unit 10
Forms of Business
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Large Corporations in the USA
Although there are many small and medium-sized corporations, bigger
business units are needed to perform certain services in the vast economy. Large
corporations can supply goods and services to a greater number of people across a
wider geographic area than small businesses. They serve consumers across the nation
and across the world. Corporate products tend to cost less per unit sold. Moreover,
consumers benefit from the availability of corporate “brand names”, which they
recognize as guaranteeing a certain level of quality wherever purchased.
Large corporations also have the financial strength to research, develop and
produce new goods. Their scientific know-how, innovation and technical capability
are critical to maintaining the nation’s competitiveness and productivity.
In the USA, a corporation is a specific legal form of organization of persons
and resources chartered by one of the 50 states for the purpose of conducting
business. When people and resources are brought together, the result in the eyes of
the law – is a person (Indeed, the Latin word “corpus” means “body” or “person”). A
US corporation, distinct from any individual human being, may own a property, sue
or be sued in the court and make contracts. For this reason, a corporation is an ideal
vehicle for the conduct of business by many smaller enterprises as well as larger
ones.
The corporate form of business is a more flexible instrument for large-scale
economic activity than the sole-proprietorship or partnership.
First, the corporation itself has legal standing, it safeguards its owners.
Second, the owners of shares of stock have limited liability; they are not responsible
for debts. Third, corporate stock is transferable. An owner of stock can sell his or her
holdings at any time or pass the stock along to heirs.
Note:
to sue – подавать в суд
heir – наследник
A Business Plan
Life may be very chaotic when you are starting or running a small business.
The telephone calls to make, the letters to write, the decisions to take – all the day-today emergencies can push aside the sort of long-term strategic planning which is
essential to keep your enterprise on the right track.
Doing a business plan before you start your firm is vital because it will
spotlight potential problems before they arise and suggest ways to solve them –
saving your time, money and headaches. A business plan consists of organized
answers to a series of carefully thought-out questions vital to starting any successful
company. Assembling this plan will be your first opportunity to manage your new
business.
When people talk about a business plan they are usually referring to a formal
written document. A written document helps to focus your thinking and gives you
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something to refer to later. Doing a business plan you write long-term objectives,
estimates and forecasts on paper. There is nothing like writing something down to
help clarify your mind and reveal your uncertainties and weaknesses.
But a business plan is more than a document, it is the entire process you go
through to clarify and evaluate your prospective company. Once you have put down
your plan, do not necessarily accept that it is set in concrete. Forecasts and objectives
change as new bits of information and your better experience emerge.
As it is important for your plan to look professional, you may consider
seeking advice and help on its production. This is available from enterprise agencies
and training courses, accountants and corporate finance specialists. If your forecasts
are likely to be fairly complicated and need changing, you might consider using a
computer programme designed to enable you to produce forecasts and to examine the
effect changes will have on the results.
Notes:
to spotlight – сделать что-либо центром внимания; выдвинуть на первый план
to manage – управлять, руководить
to refer to something – ссылаться на что-либо
to evaluate – оценить
to be set in concrete – быть неизменным, не подлежать изменениям
Unit 11
Government and Business
The Government Role in the Chinese Economy
The Chinese economy has grown immensely in the past few years, and a big
part of that is because of the government and the changes it has made in the economic
structure of the country. Today China has the fastest growing economy on the planet
and it is expected to become the strongest and largest economy in the world by the
middle of the 21-st century or even earlier. At its current rate of growth, analysts see
China replacing the US as the world’s top economy in about a decade. “It’s realistic
to say that within 10 years China will be roughly the same size as the US economy”,
says Tom Miller of GK Dragonomics, a Beijing-based economic consultancy.
It’s a growing force and it all began in 1978 when the government made the
decision to lessen its restrictions and bring in more free enterprise in the economy
and business. So, since 1978 the government’s role in the economy has fallen greatly,
while the role of private enterprises has grown. In 1994, the pricing system was
changed to allow free price movements. By the mid 1990s China was well on the
path of opening up its economy. Export was flooding out and China was given the
title of “the world’s factory”. Taking advantage of its huge population, China began
to move up in the ranking of the world’s top economies.
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But nevertheless, the government still maintains an active role in the
economy. The government’s management of the economy is involved through a topdown chain of command with hundreds of ministries, commissions, administrations,
bureaus, and corporations. Direct control of the economy by the government is done
through designating physical output quotas, while indirect control is done through
affecting market incentives.
Over the past 35 years, Chinese companies have begun to gain more and more
independence from the government in a range of activities. Together with this, largescale construction, as well as important industries and services are still managed
heavily by the government through direct management and 1/3 of the country’s GDP
is still generated through government-controlled industries.
Notes:
free enterprise – свободное предпринимательство
open up - активизировать
output quotas – нормы выработки
Unit 12
Corporate Culture
SOL’s Approach to Corporate Culture
As one of northern Europe’s most admired companies, SOL Cleaning Service,
located in Helsinki, Finland, isn’t what you might expect. The company’s
headquarters positively “explodes” with color, creativity, and chaos. Smart in bright
red-and- yellow uniforms, staff hurry about, carrying laptops and the latest smart
phones, as well as vacuum cleaners. All this might seem tailor-made for creative
organizational types (such as software designers or advertising executives), but SOL
competes in a basic and unglamorous business – industrial cleaning. It’s a highenergy, knowledge-driven organization whose business is washing hospital floors,
making hotel beds, and sweeping grocery store aisles.
This is a company in which people work when they like, and flexibility is
strongly tested. The philosophy of its chairman and owner is: “In a service business,
if you are not happy with yourself, how can you make the customer happy?”
Answering that question has made SOL wildly successful. What does the company
do differently to “clean up” in an industry notorious for low wages and terrible
service?
SOL is characterized by five corporate values. First, hard work has to be fun,
that’s why the company’s culture is built around optimism and good cheer. SOL’s
logo – a yellow happy face – is plastered on everything: from the company’s
stationery to the most important financial statements. Employees enjoy the freedom
of minimal rules and regulations; there are no titles, individual offices, or set working
hours; and the company has eliminated all perks and status symbols.
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Second, there are no low-skill jobs. The company invests significant amounts
of time and money in training employees. SOL’s staff study topics such as time
management, people skills, and budgeting. Training is focused on turning cleaners
into customer service specialists.
Third, people who set their own targets shoot for the stars. SOL employees
have significant amounts of responsibility and authority. The company’s supervisors,
each of whom leads a team of up to 50 cleaners, work with the teams to create their
own budgets, do their own hiring, and negotiate their own deals with customers.
The fourth value is loose organizations need tight measures. Although the
chairman believes in employee autonomy, she is a fanatic about performance
measurement and accountability. The company measures performance frequently,
and most of these measures focus on customer satisfaction.
Finally, SOL believes that great service demands cutting-edge technology. In
fact laptops and other gadgets are standard equipment for all supervisors at SOL. The
company uses its intranet for scheduling training, relaying news, and informing
employees about upcoming company events.
Notes:
headquarters – штаб-квартира
flexibility – гибкость
notorious – (зд.) пользующийся дурной славой, печально известный
perks – льготы, привилегии
accountability – подотчётность
cutting-edge technology – передовая технология
Unit 13
Employment
Satisfiers and Motivators
It’s logical to suppose that things like good labour relations, good working
conditions, good wages and benefits, and job security motivate workers. But in
“Work and the Nature of Man”, Frederick Herzberg argued that such conditions don’t
motivate workers. They are merely “satisfiers” or, more importantly, “dissatisfiers”.
“Motivators”, on the contrary, include things such as having a challenging and
interesting job, recognition and responsibility, promotion, and so on.
However, even with the development of IT technologies, there are and always
will be plenty of boring, mindless, repetitive and mechanical jobs in all sectors of the
economy, and lots of unskilled people who have to do them.
So how do managers motivate people in such jobs? One solution is to give
them some responsibilities, not as individuals but as part of a team. For example,
some supermarkets combine office staff, the people who fill the shelves, and the
people who work on the checkout tills into a team and let them decide what product
lines to stock, how to display them, and so on. Other employers ensure that people in
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repetitive jobs change them every couple of hours, as doing 4 different repetitive jobs
a day is better than doing only 1. Many people now talk about the importance of a
company’s shared values or corporate culture, with which all the staff can identify:
for example, being the best hotel or restaurant chain, or airline, or making the best,
the safest, the most user-friendly, the most ecological and the most reliable products
in a particular field. Such values are more likely to motivate workers than financial
targets, which ultimately only concern a few people. Unfortunately, there is just a
limited number of such goals to go round, and by definition, not all the competing
companies in an industry can seriously claim to be the best.
Notes:
checkout till – касса (в магазине)
user-friendly – удобный для пользователя
Unit 14
Globalization
Global Organizations
International businesses have been around for a long time. Siemens, for
instance, was selling its products in many countries in the 19-th century. Ford Motor
Company set up its first overseas sales branch in France in 1908. By the 1920s, other
companies, including Fiat, had gone multinational. But it wasn’t until the mid-1960s
that multinational corporations (MNCs) became commonplace. These corporations
– which maintain significant operations in two or more countries simultaneously but
are based in one home country – inaugurated the rapid growth in international trade.
The expanding global environment has extended the goals of MNCs to create
an even more generic global organization called the transnational corporation
(TNC). This type of organization doesn’t seek to replicate its domestic success by
managing foreign operations from its home country. Rather, decision making at
TNCs takes place at the local level. Nationals typically are hired to run operations in
each country. The product or marketing strategies for each country are uniquely
tailored to that country’s culture. Nestle, for example, is a transnational company.
With operations in almost every country on the globe, it is the world’s largest food
company, yet its managers match the company’s products to its consumers. Thus, in
parts of Europe Nestle sells products that are not available in the USA or Latin
America.
Many large, well-known companies are moving to globalize their
management structure more effectively by breaking down internal arrangements that
impose artificial geographical barriers; this global type of organization is called a
borderless organization. The borderless organization can be said to approach global
business from the geocentric perspective. For instance, IBM dropped its
organizational structure based on the country and reorganized into some industry
groups.
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Managers of multinational, transnational, and borderless organizations have
become increasingly global in their perspectives and accept the reality that national
borders no longer define ways of doing business efficiently and effectively.
Notes:
replicate – повторять, копировать
impose – навязывать
artificial – искусственный
Unit 15
The First Modern Economists
The Basics of Adam Smith’s Works
In 1759, Adam Smith published his first work “The Theory of Moral
Sentiments”. He continued making extensive revisions to the book up until his death.
Although “The Wealth of Nations” is widely regarded as Smith's most influential
work, it is believed that Smith himself considered “The Theory of Moral Sentiments”
to be a superior work.
In the work, Smith critically examines the moral thinking of his time, and
suggests that conscience arises from social relationships. His goal in writing the work
was to explain the source of mankind's ability to form moral judgements, in spite of
man's natural inclinations towards self-interest. Smith proposes a theory of sympathy,
in which the act of observing others makes people aware of themselves and the
morality of their own behavior.
Scholars have traditionally perceived a conflict between “The Theory of
Moral Sentiments” and “The Wealth of Nations” - the former emphasizes sympathy
for others, while the latter focuses on the role of self-interest. In recent years,
however, some scholars have argued that no contradiction exists. They claim that in
“The Theory of Moral Sentiments”, Adam Smith develops a theory of psychology in
which individuals seek the approval of the "impartial spectator" because of their
natural desire to have outside observers. Rather than viewing “The Wealth of
Nations” and “The Theory of Moral Sentiments” as presenting incompatible views of
human nature, some scholars regard these works as emphasizing different aspects of
human nature that vary depending on the situation.
But these views ignore that Smith's visit to France (1764–1766) changed
radically his former views and that “The Wealth of Nations” is an inhomogeneous
convolute of his former lectures. Before his voyage to France in “The Theory of
Moral Sentiments”, Adam Smith refers to an "invisible hand" which ensures that the
gluttony of the rich helps the poor, as the stomachs of the rich are so limited that they
have to spend their fortune on servants. After his visit to France, Smith considers in
“the Wealth of Nations” (1776) the gluttony of the rich as unproductive labour. The
micro-economic view in the traditions of Aristotle, Puffendorf and Hutcheson,
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Smith's teacher, – elements compatible with a neoclassical theory – changed to the
macro-economic view of the classical theory that Adam Smith learned in France.
Notes:
theory of sympathy – теория сочувствия, сострадания
contradiction – противоречие, несоответствие
impartial spectator – беспристрастный наблюдатель
compatible – совместимый
gluttony – обжорство
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