II. Economics

1. Go through the following vocabulary notes to avoid difficulties in understanding and find these words in the text.

decrease	уменьшать	consumer	потребитель
scarce	недостаточный, скудный	accounting	бухгалтерское дело
inputs	затраты (на производство)	employment	занятие; работа (по найму)
output	продукция; выпуск изделий	labor force	рабочая сила
allocate	распределять	increase	увеличивать

2. Match the words in the left column with the definitions in the right column.

1.economics 2.macroeconomics 3.microeconomics 4.scarcity 5.resources 6.goods 7.employment 8. economic growth 9. price stability

a) the state achieved by monetary control, balanced budgets, etc.; b) the branch of economics concerned with particular commodities, firms, or individuals and the economic relationships between them; c) possessions and personal property d) inadequate supply; e) the social science concerned with the production and consumption of goods and services and the analysis of the commercial activities of a society; f) the work or occupation in which a person is employed; g) a source of economic wealth, esp. of a country (mineral, land, labor, etc.) or business enterprise (capital, equipment, personnel, etc.); h) the branch of economics concerned with aggregates, such as national income, consumption, and investment; i) this period characterized by rising wages, profits, and prices, full employment, and high levels of investment, trade, and other economic activity.

3. Read the text and explain the highlighted words.

Economics is the study of how society allocates scarce resources and goods. Resources are the inputs that society uses to produce output, called goods. Resources include inputs such as labor, capital, and land. Goods include products such as food, clothing, and housing as well as services such as those provided by doctors, repairmen, and police offices. These resources and goods are considered scarce because of society's tendency to demand more resources and goods than are available.

Most resources are scarce, but some are not — for example, the air we breathe. Its price is zero. It is called a free resource. Economics, however, is mainly concerned with scarce resources and goods, as scarcity motivated the study of how society allocates resources and goods.

The term market refers to any arrangement that allows people to trade with each other. The term market system refers to the collection of all markets, also to the relationships among these markets. The study of the market system, which is the subject of economics, is divided into two main theories; they are macroeconomics and microeconomics.

Macroeconomics

The prefix macro means large, indicating that macroeconomics is concerned with the study of the market system on a large scale. Macroeconomics considers the aggregate performance of all markets in the market system and is concerned with the choices made by the large subsectors of the economy — the household sector, which includes all consumers; the business sector, which includes all firms; and the government sector, which includes all government agencies.

Microeconomics

The prefix micro means small, indicating that microeconomics is concerned with the study of the market system on a small scale.

Microeconomics considers the individual markets that make up the market system and is concerned with the choices made by small economic units such as individual consumers, individual firms, or individual government agencies.

Economic Policy

An economic policy is a course of action that is intended to influence or control the behavior of the economy. Economic policies are normally implemented and administered by the government. The goals of economic policy consist of value judgments about what economic policy should strive to achieve. While there is some disagreement about the appropriate goals of economic policy, there are three widely accepted goals including:

1. Economic growth: It means that the incomes of all consumers and firms (after accounting for inflation) are increasing over time.

2. Full employment: It means that every member of the labor force who wants to work is able to find work.

3. Price stability: It means to prevent increases in the general price level known as inflation, as well as decreases in the general price level known as deflation.

4. Answer these questions using the active vocabulary of the text.

1. What is the definition of economics?

2. Why are resources scarce?

3. What are the two main theories of economics?

4. What do they deal with?

5. What are the goals of economic policy?

6. What is inflation?

5. Read the text again and decide whether these statements are true (T) or false (F).

1. Economics is the study of how society allocates scarce resources and goods.

2. Society's tendency is to demand more resources and goods than are available.

3. The term market refers to any arrangement that allows people to trade with each other.

4. Microeconomics is concerned with the study of the market system on a large scale.

5. Macroeconomics is concerned with the choices made by small economic units such as individual consumers, individual firms, or individual government agencies.

6. Economic policies are normally implemented and administered by the private sector.

7. Three widely accepted goals include labor force, inflation and the incomes of all consumers.

6. Find Russian equivalents to the following phrases in the second column.

1.scarce resources 2.available 3.on a large scale 4.aggregate performance 5.household 6.implemented 7.value judgments 8.strive to 9.appropriate goals 10.general price level

a)в крупном масштабе b)доступный c)хозяйственный d) субъективные оценки e)недостаточные ресурсы f)общий ценовой уровень g)реализованный h) стараться, пытаться i)совокупная производительность j)соответствующие показатели

7. Make an outline of the text consisting of 5-8 sentences.

8. Retell the text according to its outline.