7 The sources of income

7.1 Discuss these questions

1. What are types of income do you know?

2. What are two ways to earn income?

7.2 Read the text

Before people can consume anything, however, they must do two things. First they must earn the income to buy the things they want. Then they must decide how the money will be spent. There are two ways to earn income: from work and from the use of wealth.

Income From Work

Most of the income comes from work. In return for working, people receive a wage or a salary. The term «wage» typically refers to the earnings of workers paid by the hour or unit of production. «Salary* refers to earnings paid on a weekly or monthly basis. How much you earn will depend on the kind of job, the abilities, the performance, and a number of other factors.

Income From Wealth.

Wealth can be expressed as the value of the things you own. Adding the value of all your possessions, bank accounts, savings, and the like will give you the total amount of your wealth.

Used in certain ways, wealth can earn income. If you owned a house, you might be able to let others use it for a fee. In that instance economists would say that you used your wealth to earn “rent”. Wealth, in the form of money that is loaned to others or deposited in a savings account, will earn interest. As you can see, interest and rent are two forms of income that can be earned by wealth.

Other types of income are dividends and capital gains that can be generated from the wealth.

7.3 Study new vocabulary

Source – источник

profit – прибыль

to consume - потреблять

a wage – оклад

earn the income — зарабатывать доход

a salary - жалованье

earnings - заработки

dividends — дивиденды

capital gains — прирост капитальной

savings – сбережения

wealth - cостояние

instance - случай

7.4 Translate the word combinations

To consume anything, to buy the things, receive a wage, use of wealth, typically refers, bank accounts, earn interest, generated from the wealth, savings account.

7.5 Match these terms with their definitions

1.salary	a) the form of money that is loaned to others
2.wage	b) the price paid for the use of land
3.interest	c)the earnings of workers paid by the hour or unit of production
4.rent	d) payment for the use of someone else's money
5.wealth	e) the earnings paid on a weekly or monthly basis

7.6 Mark these statements T or F according to the information in the texts

1. There are two ways to earn income: from work and from the use of wealth.

2. Other types of income are wage and salary that can be generated from the wealth.

3. In that instance economists would say that you used your wealth to earn “wage”

4. Wealth can be expressed as the value of the things you own.

5. Interest and rent are two forms of income that can be earned by work.

7.7 Replace these sentences in order

1. The term “wage” typically refers to the earnings of workers paid by the hour or unit of production.

2. How much you earn will depend on the kind of job, the abilities, the performance, and a number of other factors.

3. Most of the income comes from work.

4. “Salary” refers to earnings paid on a weekly or monthly basis.

5. In return for working, people receive a wage or a salary.

7.8 Use the words in this box to complete these sentences

People, wealth, income, owned money, a savings account

1. Before___ can consume anything, however, they must do two things.

2. First they must earn the ___ to buy the things they want.

3. Then they must decide how the___ will be spent.

4. There are two ways to earn income: from work and from the use of ___.

5. If you ___ a house, you might be able to let others use it for a fee.

6. Wealth, in the form of money that is loaned to others or deposited in _ _____ ____, will earn interest.

7.9 Write an occupation of a person Compose one sentence with each word

1. produce —

2. consume —

3. trade —

4. purchase —

5. sell —

6. observe —