- •Пензенский государственный университет economics
- •Пенза 2005
- •Glossary
- •Introduction
- •Exercises
- •Text 2 Entrepreneurs
- •Exercises
- •Text 3 The Elements of Risks
- •Exercises
- •Discussion
- •Unit II. Small-scale business Glossary
- •1. Translate the following derivatives paying attention to the suffixes:
- •Text 1 The Sole Proprietorship
- •Exercises
- •Text 2 Limitations to the Size of Proprietorship (1)
- •Exercises
- •Text 3 Limitations to the Size of Proprietorship (2)
- •Exercises
- •Text 4 The Partnership
- •Exercises
- •Discussion
- •Unit III. Large-Scale Business Glossary
- •1. Choose several principles to arrange the words into groups.Translate the words:
- •Text 1 The Corporation
- •Exercises
- •3. Give derivatives of the following words and translate them:
- •Text 2. Organization of the Corporation
- •Exercises
- •3. Give derivatives of the following words and translate them:
- •Text 3. Organization of the Corporation II
- •Exercises
- •Unit IV. Securities and the Organization of the Corporation Glossary
- •Text 1. Organization of the Corporation III
- •Exercises
- •Text 2. Bonds
- •Exercises
- •Text 3. Leverage
- •Discussion
- •Unit V. Financial Aspects of Corporation Glossary
- •Text 1. Corporate Finance
- •Exercises
- •Text 2. The Securities and Exchange Commission
- •Exercises
- •Text 3. Concentration of Control
- •Exercises
- •Text 4. Management Control
- •Exercises
- •Discussion
- •Unit VI. Evaluating Performance of the Firm Glossary
- •Text 1 The Balance Sheet
- •Exercises
- •Text 2 The Income Statement
- •Exercises
- •Discussion
- •Unit VII. The Importance of the Corporation Glossary
- •Text 1 The Number of Corporations
- •The Size of Corporations
- •Exercises
- •Text 2 Size of Firm Vs. Size of Plant
- •Exercises
- •Text 3 Specialized Management
- •Exercises
- •Text 4 Other Reasons for Larger Firms
- •Exercises
- •Discussion
- •Review tasks
- •Literature
- •Contents
Text 2 Limitations to the Size of Proprietorship (1)
a). Read and translate the title of Texts 2 and 3.
b). Look through the texts and try to find the key sentences to state the main limitations to the size of proprietorship. How many limitations are discussed in the text?
c). Make an abstract of the texts before you translate it into Russian.
d). Translate the text.
e). Read the texts and make a plan for you report about this form of a small-scale business.
Its simplicity makes the proprietorship especially well adapted to small-scale business. However, there are several limitations to its size. First, the proprietorship can grow no larger than the wealth of a single person will permit. In the age of large-scale operations that often require expensive, specialized equipment, few people can accumulate enough capital to finance efficient production.
Of course, the proprietor can supplement his own wealth by borrowing money from other people. But even this technique is limited by his resources.
The reason is, of course, the ever-present risk of losses. A firm that loses can still repay its debts, as long as the loss is no larger than the owner’s own investment in the firm. So, the owner’s equity provides a cushion to protect the creditors. When a $1 million firm is financed by $750,000 invested by the owner and $250,000 borrowed from the creditors, the owner’s equity is $750,000. If the firm has to be liquidated, the assets can lose their value, but creditors will still receive 100 cents on the dollar. If the owner’s equity were only $250,000 and $750,000 were borrowed, however, any loss in asset value exceeding $250,000 would involve losses to creditors.
Exercises
1. Find the English equivalents in the text:
малый бизнес, крупномасштабные операции, специальное оборудование, накапливать капитал, финансировать производство, пополнять благосостояние, платить долги, вклад в бизнес.
2. Find the synonyms of the following words in the text:
possession, riches, sole, action, to accrue, successful, owner, to add, method, stores, waste, share, cost.
3. Give antonyms of the following words:
simplicity, small-scale, to grow, expensive, efficient, to borrow, limited, present, loss, to lose.
4. Give possible translations of the words:
wealth, single, grow, age, capital, technique, share, equity, asset(s), value.
5. Give logical word-combinations with the words share and business and translate them.
6. Write definitions for the following notions:
large-scale operation, expensive equipment, efficient production, to borrow the wealth, to repay the debts, investment in business, the owner’s equity, to liquidate a firm, assets of the firm, creditor.
Text 3 Limitations to the Size of Proprietorship (2)
Another limitation to the size of a sole proprietorship is the difficulty of changing ownership. Investment in a personal business is necessarily a long-term proposition. To get out for any reason – perhaps to follow a more profitable venture in another line – requires sale of the physical assets of the business to a new owner. But it is a slow process. The owner must find another man who combines the ability to run the business with the desire to enter it, and who has the money to buy out the owner’s equity. It may take months in the USA to find the right man. But if the owner is in a hurry to sell out, he may have to sacrifice a substantial part of the value of the firm.
The difficulties involved in selling a sole proprietorship mean that this type of business tends to tie down those who have the greatest talent for business organization. It takes more enterprising talent and organizing skill to start a successful business than to keep it going after it has been set up. Economic growth will be most rapid when those with the greatest initiative and talent can specialize in setting up new firms to exploit new opportunities. This is impossible if the organizer cannot sell his firm to somebody else to run, and move on to new fields. This fact becomes a serious limitation to an economic system that depends on private enterprise to get things done in the best way.