III. Now read the text again and answer the questions.

1. According to neoclassical economists, what do consumers want?

A. The most satisfaction at the lowest cost.

B. The cheapest product.

C. To spend all their money.

2. What is budget constraint?

A. An amount of money you want to save.

B. A combination of money and satisfaction.

C. The total amount of money you have to spend.

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3. What is utility?

A. How much of a product you get.

B. The satisfaction you get from a product or service.

C. The cost of a product.

4. What explains marginal utility?

A. The more satisfaction something gives you, the more you want it.

B. The more satisfaction something gives you, the less you want it.

C. The more you have of something, the less satisfaction it gives you.

5. What do neoclassical economists believe about consumers?

A. They make logical decisions.

B. They always know what they want before they go shopping.

C. They don’t know what they want.

IV. Choose the correct word or phrase.

1. If you are in a hurry, it can be difficult to make a maximum / rational decision.

2. The amount of money you have to spend is your budget constraint / deciding factor.

3. The maximum / rational speed limit on this road is 120 kilometers per hour.

4. Quality is often the deciding factor / budget constraint when people choose something to buy.

5. Some people calculate / assume how much they spend every week.

6. Green is a combination / an alternative of yellow and blue.

7. When you buy something from a shop, you make a purchase / budget constraint.

8. When you calculate / assume something is true, you guess that it is true.

9. The use or satisfaction you get from something you buy is called utility / purchase.

10. Olive oil is a healthy alternative / combination to butter.

V. Say what you have learned about:

• Rational choices of consumers

• Budget constraint

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• Own utility value of goods

• Satisfaction from a purchase

• Significance of consumers` income Think and give extensive answers.

VI. Discuss with your partner how you make choices about what you are going to buy.

Think about:

• budget

• the price

• satisfaction with the goods.

Grammar exercises

VII. Put the sentences into negative form (§ 13). Practise the use of the sentences in negative form.

1. Our secretary makes appointment with foreign businessmen.

2. She wrote letters and cables in English. 3. They usually arrange visits to foreign firms. 4. Our secretary must go through the mail before the president gets it. 5. He was shocked to realize that his documents were missed. 6. They thought that she had lost her way. 7. She tried to explain the situation. 8. He stopped and tried to remember all the events. 9. Mr. Smith came to Moscow to negotiate the purchase of railway carriages. 10. We are prepared to grant you a 5 percent discount. 11. They got discount and doubled their order. 12. You will be impressed by the design of the model. 13. Our price is based on the prices existing on the world market.