Unit X

WORD-STUDY

Exercise 1. Check the translation in a dictionary, read and translate the words listed below.

Nouns

monopoly, consumer, consumption, growth, circulation, deposit, fuel, inflation.

Verbs

determine, encourage, stimulate, increase, predict, inflate.

Adjectives

modern, available, stimulating, basic.

Exercise 2. Make different parts of speech from the following words according to the models.

a)Model: adjective + th=noun (wide – width); young, strong, broad, long.

b)Model: noun + ic=adjective (economy – economic); atom, climate, energy.

UNDERSTANDING A PRINTED TEXT

WHAT IS MONEY SUPPLY?

Every economy in the world is controlled by its supply of money, even one as small as the Monopoly game where players are provided with Monopoly money for buying and selling houses, hotels, and property around the board. The money supply of the Monopoly game, for example, primarily consists of the players' cash on hand and the money they get for passing Go.

A modern economy is based on the use of money. Each country's money supply, therefore, determines how quickly the economy can grow. If the central bank increases the money supply, consumers and businesses have more money to spend on goods and services.

Just as the game of Monopoly can be stimulated by increasing the amount money available to its players, a country can encourage economic growth by increasing its money supply, which includes currency in circulation and readily available funds such as bank deposits on which checks can be drawn. This "narrow" measure of the money supply is usually called "M1." This easy-to-access money, often called "highpowered" money, tends to fuel most consumer and business consumption and therefore stimulates most economic growth.

Other measures of a country's money supply include funds that are not so readily available, such as time deposits and other long-term investments. These "wider" measures are often referred to as "M3" and "M4" or "L."

Basically, when businesses and individuals have less money at their disposal, economic activity slows down. Central banks usually limit money supply growth in

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