Exercises

1. Answer the questions.

1) What does money supply in most countries comprise?

2) What physical commodities were used for money?

3) What does the amount of money in circulation determine?

4) How does the increase in the money supply affect the economy?

5) What effects may the increased money supply lead to?

6) What happens when money supply falls?

7) What are disinflation and deflation?

8) What institution determines the money supply?

2. Complete the sentences with words and phrases from the right part.

1) Money supply in most countries a) either disinflation or deflation

comprises … results.

2) Business firms respond to increased b) firms issue shares and bonds.

sales by ordering more …

3) In a booming economy, stock market c) currency.

prices rise and …

4) If the money supply continues to d) an expected decline in purchasing

expand … power.

5) Lenders insist on higher interest e) the central bank.

rates to offset …

6) Economic activity declines and … f) raw materials.

7) The most important determinant of g) prices begin to rise.

the money supply is …

3. Translate into English.

1) Население держит вклады в различных коммерческих банках.

2) Долгое время физические товары, чаще всего золото и серебро, служили в качестве денег.

3) В целях регулирования национальной экономики финансовые органы наделяются полномочиями по выпуску бумажных денег.

4) Так как деньги используются во всех экономических операциях, они оказывают большое воздействие на экономическую деятельность.

5) Компании отвечают на рост продаж, заказывая большее количество сырья.

6) Рост деловой активности увеличивает спрос на рабочую силу.

7) В экономике, переживающей подъем, цены фондового рынка растут, и компании выпускают акции и облигации.

4. Complete the text using the words:

credit, output, demand, inflation, circulation, unemployment, interest rates

If a government pursues a tight monetary policy, it restricts the amount of money in 1) … and reduces the funds available to banks. When money is tight:

2) … rise, because commercial banks have to borrow at a higher rate on the inter-bank market.

3) … falls, because people and businesses borrow less at higher rates.

4) … falls, because people and businesses buy less, as they have less money.

5) … falls too, because with less consumption, firms produce less.

6) … rises, because companies are producing and selling less, and so need less labour.

7) … falls, because there is less money in circulation.

5. Read the text and translate it into Russian.

The Financial Management

The financial plan of a company includes the timing and the amounts of funds, as well as the inflow and outflow of money. Financial managers also forecast the economic conditions, the company’s revenues, expenses and profits.

The plan starts and ends with the company’s objectives. Managers review them and determine the funding they require. Managers also compare the expenses involved and the revenues expected. It helps them predict cash flow. Management plans a strategy to make the ending cash positive, and accordingly works out the way the resources should be allocated.

Resources are invested according to the strategic plan of a company into materials and inventory, personnel and advertising, etc. Managers are responsible for carrying out this strategy, the whole process being supervised by the General Executive and the Board of Directors of the company.

6. Translate the questions into English and answer them.

1) Что включает в себя финансовый план компании?

2) Что еще прогнозируют финансовые менеджеры?

3) Чем начинается и заканчивается план?

4) Что сравнивают менеджеры?

5) Какова цель финансовой стратегии?

6) Во что инвестируются ресурсы?

7) Кто отвечает за выполнение финансовой стратегии?

8) Кем контролируется весь процесс?

7. Summarize the information of the unit and speak on the topic: Money Supply