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2. Answer the questions:

  1. What does the word ‘supply’ refer to?

  2. What does the Law of Supply state?

  3. What does a rise in prices encourage?

  4. What does a fall in prices cause?

  5. The supply of what types of goods is said to be elastic?

3. Say whether these statements true (t) or false (f), and if they are false say why.

  1. ( ) Supply does not refer to the amounts which traders are prepared to sell.

  2. ( ) When farmers consider the market price to be low they sell off their goods.

  3. ( ) According to the Law of Supply, a rise in prices tends to reduce supply.

  4. ( ) If prices fall locally, production will be reduced throughout the world.

  5. ( ) When there is a glut on the market, demand decreases and prices fall.

  6. ( ) Changes in prices lead to a change in the quality of a commodity.

  7. ( ) Supply is ‘elastic’ because market prices rise and fall.

  8. ( ) Over-production encourages producers to make more of the commodity.

4. Look through the text again and give Ukrainian/Russian equivalents to the following English words and word combinations:

Supply(n), refer, traders, for sale, given price, too low, throw away, go out of business, glut, create, over-production, completely, mean, stock, throughout the world, market conditions.

5.Give English equivalents to the following words and word combinations from the text:

Пропонувати, кількість, закон пропозиції, на місцевому рівні, призвести, ринкова ціна, у відповідь на, відповідати (вимогам), пристосувати, вважати, зернові, заохочувати.

6. Complete the following sentences with words or word combinations from the text:

  1. … is elastic when a small price … has a relatively large effect on the amount supplied.

  2. Sometimes it takes long to … your production to market conditions.

  3. … of any commodity can create difficulties.

  4. … to your letter I inform you that your order has been received.

  5. Supply is elastic when the amounts … for sale can be easily and quickly … .

  6. Prices fell … and … the world.

  7. They … our offer to be interesting.

  8. … they are good suppliers but on the other they are bad payers.

  9. This commodity glut … many difficulties in the economy of the country.

  10. …, vegetables and fruit are agricultural goods.

7. Below are pairs of the sentences. In the first sentence there is a verb in italics. In the second sentence there is a blank. Make the italicized verb into a noun in order to fill the blank.

EXAMPLE: manage → manage + ment → management

  1. It is sometimes necessary to adjust the quantity of goods flowing on to the market. This … is made according to market conditions.

  2. He arranged the committee meeting. His … were very efficient.

  3. The government encourages private enterprise. Their … sometimes takes the form of financial help.

  4. Some economists are interested in measuring changes in the price of essential commodities. This … extends over a period of years.

  5. The management tried to assess the amount of money needed for the plan. The … was to be made by a special committee.

  6. He decided to invest his capital in the new enterprise. His … might be very profitable.

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