Lesson I basics of economics
Economics is the scientific study of the way in which wealth is produced and used. It also studies the choices people make to satisfy their wants and needs. Contrary to popular opinion, economics does not normally include such things as personal finance, personal income, ways to start a small business, etc. The range of problems considered by economists is relatively narrow. They deal with employment, expenditure, interest rates, consumption, transportation, and trade. In relation to everyday life, the economist is more like an astronomer than a weather forecaster, more like a chemist than a pharmacist, more like a professor of hydrodynamics than a plumber.
The basic problem of economics is scarcity created by unlimited wants of society and limited resources. To achieve this goal, economists must find the most efficient ways to distribute and use these limited resources called the factors of production. They include natural resources, human resources, capital and entrepreneurship. Each factor of production has a place in economic system.
1. Natural Resources or "Land" are the things provided by nature that go into production of goods and services. They include such things as minerals, animals, forests, even the sun, wind and rain (but only when these things are used to produce goods and provide services).
2. Human Resources or «Labour» are the physical and mental effort that people put into the creation of goods and services. The price paid for the use of labour is called wages. Wages represent income to workers, who own their labour.
3. Capital is something created by people to produce other goods and services. A factory, tools and machines are capital resources because they can be used to produce other goods and services. The term "capital" is often used by business people to refer to money they can use to buy factories, machinery and other productive resources. We can also see an important distinction between capital goods and consumer goods. Capital goods are the manufactured resources that are used in producing finished products. Consumer goods are the finished products - the goods and services that consumers buy.
4. Entrepreneurship is the managerial or organizational skills needed by most firms to produce goods and services. The entrepreneur brings together the other three factors of production. When they are successful, entrepreneurs earn profits. When they are not successful, they suffer losses.
The reward to entrepreneurs for the risks, new ideas and efforts that they have put into the business, is the money that remains after the owners of land, labour and capital have received their payments.
Vocabulary
wealth - благо, богатство
to produce goods - производить товар(ы)
to provide services - предоставлять услуги
to satisfy wants and needs - удовлетворять нужды и потребности
popular opinion - общественное мнение
income - доход
to deal with ... - иметь дело с ...
to employ - нанимать на работу
employment - занятость
employer - работодатель
employee - служащий
expenditure - затраты
interest rates - процентные ставки
consumption - потребление
scarcity - дефицит
goal / aim / purpose / objective - цель
efficient - эффективный
efficiency - эффективность
entrepreneurship - предпринимательство
entrepreneur - предприниматель
wage(s) - заработная плата
capital goods - средства производства
consumer goods - потребительские товары
to earn profits - получать прибыль
to suffer losses - терпеть убытки
Task 1. Find in the text English equivalents for the following.
Общественное мнение; открыть фирму; круг проблем; неограниченные потребности общества; добиться цели; распределить ресурсы; факторы производства; природные ресурсы; обеспечивать услугами; человеческие ресурсы; труд; бизнесмен (2 варианта); готовые продукты; быть успешным, преуспевать; вкладывать пошло идеи в дело; награда.
Task 2. Guess some economic terms according to their meanings to do the puzzle.
1
)
something made or produced, usually for sale;
2) a supply of something that a country, an organization or a person has and can use, especially to increase their wealth;
3) a person who possesses something, esp. by legal right;
4) management of money or money itself, used to run an organization, an activity or project or to buy something;
5) money received regularly from work, investing money, business, etc.;
6) the activity of buying and selling or exchanging goods or services between people or countries;
7) the money that you make in business or by selling things, especially after paying the costs involved.
Task 3. Fill in the blanks and translate the sentences.
1. Economics studies the choices people make to satisfy their ...
2. Economics includes such problems as ...
3. The basic economic problem of scarcity is created by ...
4. The factors of production include ...
5. Natural resources are ...
6. The entrepreneurs suffer losses when ...
Task 4. Answer the question and explain your choice.
Which one of the following would not be classified as a factor of production?
a. Jim Budget, a builder in a construction firm.
b. The cement mixer Jim uses, с The cement Jim puts in the mixer.
d. The building Jim builds.
e. The wage Jim earns at the end of the week.
Task 5. Explain the following ideas, marked in the text.
1. The economist is more like an astronomer than a weather forecaster, more like a chemist than a pharmacist, more like a professor of hydrodynamics than a plumber.
2. The basic problem of economics is scarcity created by unlimited wants of society and limited resources.
3. Capital goods are the manufactured resources that are used in producing finished products.