2. Используйте выделенные слова (1-4) из предыдущего упражнения и заполните пропуски соответствующими по смыслу словами.

1. As it is a study that constitutes rational human behaviour in the endeavour to fulfill needs and wants, ________tries to explain how and why we get the stuff we want and need to live.

2. The word ________is Greek and means “household management”. It was studied by many philosophers beginning from ancient Greece, notably Aristotle.

3. It is evident that we observe the period of sustained _______growth.

4. The_______ writing style is characteristic for SMS communication.

5. The new _________theories regarding the effects of deficit spending have been developed recently.

6. Market-based _______allows goods to flow freely through the market, according to demand and supply.

7. Being a field of studying that has become vitally important in our globalized society, __________deals with money and borrowing, production and consumption, trade and markets, employment and occupations, pricing, taxes and much more.

3. Определите соответствие между словами 1 - 8 и фразами a-h.

1. resources	a. these are provided to people
2. production	b. money asked for or given in exchange for something else.
3. goods and services	c. it may be high and low
4. price	d. income
5. distribution	e. they are used to produce something
6. employment	f. when everybody gets his share
7. revenues	g. the process of manufacture
8. pricing	h. it means that somebody works

4. Прочитайте, переведите текст и ответьте на вопрос, содержащийся в его названии. What is economy and economic system?

As you know from the course of history, the development of humanity supposed the creation and working out new resources to satisfy the growing needs of people. The growth of these needs required the necessity of finding new sources to provide the production of goods and services. The problem of matching human needs and effective ways of utilizing resources can bring economic growth, high level of employment, stable prices, equitable distribution of revenues and relative social security. Thus, the complex of undertakings in the scale of a state or completely the human society, which is directed on reaching this goal, can be called economic system.

Different countries may have different kinds of economies. For example, a planned economy is the one, in which all resources are allocated by the government. It owns everything and controls prices and incomes. A mixed economy supposes something between free-market and planned economies. The government owns and allocates some resources and the free market (buyers and sellers) owns and allocates others. But the most effective is a market economy as businesses are free to buy and to sell their goods and services on the terms they like. Economic market is a set of arrangements and rules through which buyers and sellers make contact and do business.

One of the main laws of the market is the law of supply and demand, which says that if demand exceeds supply, the price tends to rise and when supply exceeds demand, the price tends to fall.

It is necessary to mention the principal instrument of the market economy - the price mechanism or pricing, which guides the decisions of producers concerning the composition of their output. Besides, in free markets, prices direct allocations of inputs that provide the firms with the most profitable usage. Furthermore, the distribution process is also governed by the price mechanism.

Thus, the market mechanism brings about an allocation of resources that reflects two basic factors: consumer preferences and production costs. The prices, which play the coordinating role of the market mechanism, are determined through the interaction of demand and supply.

Competition is the other important force of the market. On the one hand, it protects the customers – they have the right of choice and they benefit from the fact that competition keeps prices close to costs; on the other hand, it makes producers and suppliers utilize resources economically, using most sophisticated technologies. And furthermore, as all businesses produce goods and services and seek profits, they all compete with other businesses for inputs of labor, capital and natural resources, including foreign partners.

However, freedom of enterprise is not total in the market economy. Businesses are subject to laws and government regulations, which determine the economic environment, fiscal and monetary policies.

Therefore, every economic system has to deal with many challenges to survive and to perform well.