66. 3. Complete the sentences using the text:

1.    A tax has been defined as … .

2.    According to the benefit theory … .

3.    Proportional taxes do not … .

4.    Adam Smith expressed that the subject of every state … .

5.    A direct tax is … .

6.    An indirect tax is … .

7.    The income tax is progressive in character, which means … .

8.    One defect of the income tax is … .

68. 4. Answer the questions, basing your answers on the text:

1.    What is a tax?

2.    What does the benefit theory say?

3.    What does the equal-distribution theory say?

4.    What does the ability theory say?

5.    What kinds of taxes are there?

6.    What is a direct tax?

7.    What is an indirect tax?

70. 5. Say whether these statements are true or false and if they are false, say why.

1.    A tax has been defined as a compulsory charge imposed upon persons and businesses for purposes.

2.    There are three theories in accordance with which taxes may be levied.

3.    The benefit theory is rather practical.

4.    There are two kinds of taxes, direct and indirect.

5.    The sales tax is levied on goods, which the individual purchases.

6.    Governments prefer to raise money by direct taxes.

7.    The income tax is progressive and elastic.

Lesson 13 Price

71. 1. Memorize the following words and word-combinations:

    securities	цінні папери	ценные бумаги
    interest rate	процентна ставка	процентная ставка
    exchange rate	курс обміну	курс обмена
    to ration	нормувати	нормировать
    scarce resources	збіднілі ресурси	скудные ресурсы
    to go around	знаходитись навколо	находиться вокруг
    to drive out	витысняти	вытеснять
    to encourage producers	спонукати виробників	побуждать производителей
    level of output	рівень випуску	уровень выпуска

74. 2. Read and translate the text.

In economics, the term “price” denotes the consideration in cash (or in kind) for the transfer of something valuable, such as goods, services, currencies, securities, the use of money or property for a limited period of time, etc. In commercial practice, however, it is normally restricted to the amount of money payable for goods, services, and securities. In other applications, the word “rate” is preferred. Interest rate is the price for temporary use of somebody else’s money, exchange rate is the price of one currency in terms of another.

Price may refer either to one unit of a commodity (unit price) or to the amount of money payable for a specified number of units or for something where units are not applicable, e. g., for five tons of coal (total price) or for a specific painting by Rembrandt.

Prices perform two important economic functions: they ration scarce resources, and they motivate production. As a general rule, the more scare something is, the higher its price will be, and the fewer people will want to buy it. Economists describe that as the rationing effect of prices. In other words, since there is not enough of everything to go around, in market system goods and services are allocated, or distributed, based on their price.

Price increases and decreases also send messages to suppliers and potential suppliers of goods and services. As prices rise, the increase serves to attract additional producers. Similarly, price decreases drive producers out of the market. In this way prices encourage producers to increase or decrease their level of output. Economists refer to this as the production-motivating function of prices.

Prices may be either free to respond to changes in supply and demand or controlled by the government or some other (usually large) organizations.