P A R T II

The Private Enterprise System

Unit 13

What is Business?

Key Words and Phrases

profit - seeking activities	діяльність, що приносить прибуток
tangible goods	матеріальні, (реальні) товари
computer chips	комп`ютерні чіпи
expenses (expenditures)	витрати
competitors	конкуренти
competitive success	успіх в конкуренції
contemporary circumstances	сучасні обставини
to deal with	мати справу з . .

What do we think of when we hear the word "business"? Some of us think of our jobs, others of the merchants they deal with as consumers, and still others of the millions of firms that make up the world’s economy. This broad, all-inclusive term can be applied to many kinds of enterprise. Business provides the bulk of our employment as well as the products we enjoy.

Business consists of all profit-seeking activities and enterprises that provide goods and services necessary to an economic system. Some businesses produce tangible goods, such as automobiles, breakfast cereals, and computers chips. Others provide services, such as insurance, car rentals, and lodging. German firm Munich Re has even built a billion dollar business from serving the service industry. Its business is reinsurance: insuring insurance companies so they do not go broke from backing major catastrophes. Business is the economic pulse of a nation, the means through which society’s standard of living improves. Profits are a primary mechanism for accomplishing these goals. Accountants and business people define profits as the difference between a company’s revenues (receipts) and expenses (expenditures). Profits are the financial rewards by successful people who take the risk involved in business.

Just as important as profits are the social and ethical responsibilities that successful businesses must meet. This means companies must be responsible in their dealing with employees, consumers, suppliers, competitors, government, and the general public if they are to succeed in the long run. Robert D. Haas, chairman and chief executive officer of Levi Strauss & Company, says, "A company's values – what it stands for, what its people believe in – are crucial to its competitive success. Indeed, values drive the business." Haas feels so strongly about the social responsibilities of business that he drafted an Aspirations Statement for Levi Strauss that emphasizes the importance of "affirming the best of our company’s traditions, closing gaps that may exist between principles and updating some of our values to reflect contemporary circumstances."

Exercises on the text:

Ex. 1. Read and translate the text.

Ex. 2. Answer the following questions:

1. What is business?

2. What is profit?

3. What is the role of profit in business?

4. What can you say about the social and ethical responsibilities that successful business must meet?

Ex. 3. Give English equivalents for the following words and word combinations. Try to memorize them:

сучасні обставини; мати справу з виробництвом; діяльність, що приносить прибуток; продукція, котра нам подобається; страхова компанія; компанії повинні відповідати за свої справи …; кращі традиції нашої компанії.

Ex. 4. Fill in the blanks with noun, verb or adjective forms. Use your dictionary if necessary.

	Noun	Verb	Adjective
	execution	execute	executive
	—	—	competitive
	production	—	—
	—	satisfy	—
	—	—	valuable
	reflection	—	—
	—	apply	—
	success	—	—