Vocabulary Focus

Easily confused words: economic/economics/economy/economical/economist/ economize.

Study the explanations of the words.

Economic means concerned with the organization of the money, industry, and trade of a country, region, or social group.

Something that is economical does not require a lot of money to operate. If someone is economical, they spend money carefully and sensibly.

Ex. 1. Complete the following sentences with the appropriate word from the list below.

economic economical

economics economist

economize economy

1. A good manager is _____ in the use of his funds.

2. An _____ person saves money wherever possible.

3. An _____ is a person who studies, teaches, or writes about economics.

4. By exercising strict _____ he saved enough money to retire early.

5. By using _____ in buying food and clothes, we were soon able to save money for the new car we needed.

6. _____ is a social science concerning behaviour in the fields of production, consumption, distribution, and exchange.

7. In times of difficulties we all have to _____.

8. It is much more _____ to buy in bulk.

9. Nations experience different rates of _____ growth.

10. The country is in the period of _____ and industrial crisis.

Ex. 2. From two columns choose the words with similar meaning and arrange them in pairs.

A	B
scarcity (n)	insufficiency/shortage (n)
goods (n)	merchandise (n)
degree of merit	desire (n)
economical (a)	accessible (a)
need (n)	work done for somebody or something
service (n)	infinite (a)
want (n)	option (n)
choice (n)	give up (v)
available (a)	quality (n)
forgo (v)	thrifty (a)
unlimited (a)	necessity (n)

Ex. 3. From two columns choose the words with opposite meaning and arrange them in pairs.

A	B
wealth (n) finite (a)	abundance (n) poverty (n)
satisfy (v) scarcity (n) improve (v) spend (v) revenue (n) macro (a)	dissatisfy (v) make worse economize (v) expenditure (n) micro (a) unlimited (a)

Ex. 4. Form the following pairs of derivatives and memorize them.

V ®	N	N ®	A
govern apply grow	provision improvement development	threat economics nation	wealthy scientific

Ex. 5. Match the Russian word combinations with their English equivalents.

A	B
денежная масса столкнуться с проблемой дефицита размещать ресурсы национальный доход макроэкономические переменные существенный экономический рост улучшать качество доступные ресурсы ограниченное пространство неудовлетворенные потребности альтернативные издержки субъективное мнение	to face the problem of scarcity money supply unsatisfied wants value judgement finite place opportunity cost available resources to improve the quality substantial economic growth economy-wide variables to allocate resources national income

Comprehension

Ex. 1. Expand the sentences, using the text.

1. Our world is a finite place where people… .

1. Scarcity is the condition in which… .

2. Economics is the study of how… .

3. Economy is… .

4. Macroeconomics is the branch of economics that… .

5. Microeconomics is… .

6. Economists use the term “opportunity cost” to… .

7. The opportunity cost of an individual’s decision is determined by… .

8. Nations, too, are constantly faced with… .

Ex. 2. Choose the right variant.

1. The condition of scarcity:

   1. cannot be eliminated;

   2. prevails in poor economies;

   3. prevails in rich economies;

   4. all of the above;

   5. none of the above.

2. The condition of scarcity can be eliminated if:

   1. people satisfy needs rather than false wants;

   2. sufficient new resources were discovered;

   3. output of goods and services were increased;

   4. all of the above;

   5. none of the above.

3. The subject of economics is primarily the study of:

   1. the government decision-making process;

   2. how to operate a business successfully;

   3. decision-making because of the problem of scarcity;

   4. how to make money in the stock market.

4. Which of the following is included in the study of macroeconomics?

   1. salaries of college professors;

   2. computer prices;

   3. unemployment in the nation;

   4. silver prices.

5. Microeconomics approaches the study of economics from the viewpoint of:

   1. individual or specific markets;

   2. the national economy;

   3. government units;

   4. economy-wide markets.

Ex. 3. Choose the best answer to the following questions, using the text.

1. Why is scarcity the most basic of all economic problems?

1. because the federal government must decide how much it will spend for natural defence;

2. it gives you an opportunity to buy something else;

3. because it is the most important issue in balancing unlimited needs with limited resources.

2. What is meant by the term “opportunity cost”?

1. it is your limited income;

2. it is defined as a decision to spend money;

3. it refers to the next best alternative that is given up when a decision is made to use resources in a particular way.

3. How do opportunity costs affect both individuals and nations?

1. a state must spend less money on education;

2. an individual has to give up something that gives him pleasure;

3. an individual or a nation has to sacrifice something for the choice made.

4. What is meant by the term “value judgement”?

1. it is defined as a process of decision-making;

2. it is a personal opinion about the value of a good;

3. it is a merit a good possesses.

Ex. 4. Say if these statements are true or false.

1. Because of the problem of scarcity nations, businesses, and individuals all must make choices in an effort to satisfy unlimited wants with limited resources.

2. Economists use the term opportunity cost to refer to the value of what is foregone in order to have something else.

3. Any time you decide to use scarce resource in a particular way, you do not incur an opportunity cost – the cost of the next best alternative use of that resource.

4. Governments never have problems with defence spending.

Text 2

As you read the text, focus on the following terms: 1) economic goods, 2) economic services, and 3) factors of production/productive resources, and 4) sectors in the economy.