WHAT IS ECONOMICS ABOUT

What is economics? . Economics was defined as the study of mankind in the everyday business life.

What does economics study? It is the study of human efforts to satisfy what seems like unlimited and competing wants through the careful use of relatively scarce resources

What are the key terms of economics? key terms: needs, wants, and demands.

What does economics deal with? economics deals with production, distribution, exchange and consumption.

What are economic products? economic products — goods and services that are useful, relatively scarce and transferable to others.

What is the difference between goods and services? The difference between goods and services is that the services are something that cannot be touched or felt like goods.

What are consumer goods intended for? Consumer goods are intended for final use by individuals to satisfy their wants and needs.

What are capital goods? Manufactured goods used to produce other goods and services are called capital goods

What does the term “value” mean in economics? In economics the term value means something having a worth that can be expressed in dollars and cents.

What does the term “wealth” mean in economics? Another economic concept is wealth — the sum of those economic products that are tangible, scarce, useful and transferable from one person to another.

What is counted as wealth? Most economic goods are counted as wealth, but services are not.

Why does utility of consumer goods vary from one person to another? One person may, for example, get a great deal of enjoyment from a home computer, another may get very little. In the end, for something to have value, it must be scarce and have utility.

What is country’s total worth? A country’s total worth, then is the stockpile of useful scarce, tangible things in existence at a given time.

FACTORS OF PRODUCTION

What is the reason people cannot satisfy all their wants and needs? The reason people cannot satisfy all their wants and needs is the scarcity of productive resources.

What are the factors of production? factors of production are called land, labour, capital, and organization or entrepreneurship

What does the term “land” mean? land means the gifts of nature or natural resources not created by human efforts.

What do economists think of land as a factor of production? It includes deserts, fertile fields, forests, mineral deposits, rainfall, sunshine and the climate necessary to grow crops.

What is labor in economic theory? labour — people with all their efforts and abilities.

What is the national labor force? labour force individuals,16 years of age or older, working or looking for work.

What does the size of labor depend on? the size of this force is related to total population the number of people available for production activities will grow as the population grows.

What categories does labor fall into? These categories are unskilled, semiskilled, skilled and professional or managerial.

What kind of work do unskilled workers perform? Most of these people work chiefly with their hands at such jobs as digging ditches, picking fruit, etc.

What category do workers with mechanical ability fall into? Workers who do not have the training to operate machines and equipment fall into the category of unskilled labour.

What kind of work are skilled workers able to do? Workers who are able to operate complex equipment and who can do their tasks with little supervisions fall into the category of skilled labour. Examples are carpenters, typists, toolmakers.

What is professional labor? . Workers with high level skills such as doctors, lawyers and executives of large companies fall into the category of professional labour.

What is a wage rate? wage rate — a standard amount of pay given for work performed.

What are the factors affecting the wage rate? the higher the level of skills, or grade of labour, the higher the average yearly wage rate

What is the third factor of production? The third factor of production is capital— the tools, equipment and factories used in production of goods and services.

What is the difference between physical and financial capital? financial capital, the money used to buy the tools and equipment used in production

When does production take place? When the three inputs — land, labour and capital — are present, production or the process of creating goods and services, can take place.

What is entrepreneurship? Entrepreneurship, the managerial or organizational skills needed by most firms to produce goods and services, is the fourth factor of production.

What role do the entrepreneurs play? The entrepreneur brings together the other three factors of production — land, labour and capital.

ECONOMIC SYSTEMS

What do all societies have in common? They have an economic system or an organized way of providing for the wants and needs of their people.

What does the survival of any society depend on? The survival of any society depends on its ability to provide food, clothing and shelter for its people.

What is an economic system? economic system the approach a country uses to deal with scarcity and аchieve its economic goals.

What are all societies faced with? Since these societies are also faced with scarcity decisions concerning What, How and for Whom to produce must be made.

What determines the type of any economic system? The way in which these decisions are made will determine the type of economic system they have.

What are the major kinds of economic systems? . There are three major kinds of economic systems: traditional, command and market.

How are the main economic questions decided in a society with a traditional economy? They know what goods and services will be produced, how to produce them, and how such goods and services will be distributed.

What are the main advantage and disadvantage of a traditional economy? The main advantage of the traditional economy is that everyone has a role in it. This helps keep economic life stable and community life continuous. The main disadvantage of the traditional economy is that it tends to discourage new ideas and even punishes people for breaking rules or doing things differently.

What is a command economy? a command economy — one where a central authority makes most of the What, How and for Whom decisions.

What is the major advantage of a command economy? The major advantage of a command system is that it can change direction drastically in a relatively short time.

What disadvantages does the command economy have? The major disadvantage of the command system is that it does not always meet the wants and needs of individuals.

What is a market economy? market is an arrangement that allows buyers and sellers to come together to conduct transactions.

How are the basic economic questions answered in a market economy? In a market economy, the questions of What, How and for Whom to produce are made by individuals and firms acting in their own best interests.

What is the main incentive of a market economy? profit is the main incentive of a market economy

What advantages does a market economy have? a market economy is flexible and can adjust to change over time. The second major advantage of the market economy is the freedom that exists for everyone involved. The third advantage of the market economy is the lack of significant government intervention.

MARKET CATEGORIES: DEMAND, SUPPLY, PRICE

What is demand? demand as a consumer’s desire or want, together with his willingness to pay for what he wants.

What does the law of demand state? It says that the demand for an economic product varies inversely with its price.

How do prices affect the quantities demanded? if prices are high the quantities demanded will be low. If prices are low the quantities demanded will be high.

What is demand elasticity? Elasticity of demand is a measure of the change in the quantity of a good, in response to demand.

When is demand elastic? demand elastic is when demand for the product varies with the price of the product

When is demand inelastic? Demand is inelastic when a good is regarded as a basic necessity, but particularly elastic for non-essential commodities.

What factors is demand influenced by? demand is influenced by price,the incomes of the demanders and the prices of substitutes.

What is supply? supply means the quantity of a product supplied at the price prevailed at the time.

What does the law of supply state? The law of supply states that the quantity of an economic product offered for sale varies directly with its price.

How much of a product will suppliers offer for sale at different prices? If prices are high suppliers will offer greater quantities for sale. If prices are low, they will offer smaller quantities for sale.

What factors is supply determined by? supply is determined by price, the cost of production and the period of time allowed to supply to adjust to a change in prices.

What categories of costs is it important for a business to analyze? Fixed cost, Variable cost, Total cost, Marginal cost

What role do prices play in a market economy? Prices play an important role in all economic markets

What two important economic functions do prices perform? Prices perform two important economic functions: they ration scarce resources, and they motivate production

What characteristics do prices have in a market economy? Neutral, flexible

Why do buyers and sellers have the opposite intentions and hopes? . The buyers come to the market larger to pay low prices. The sellers come to the market hoping for high prices.

When does the adjustment process take place? adjustment process must take place when the two sides come together. This process almost always leads to market equilibrium

What is market equilibrium? market equilibrium — a situation where prices are relatively stable and there is neither a surplus nor a shortage in the market.

What messages do price increases and decreases send to producers of goods and services? In a market economy prices act as signals. A high price, for example, is a signal for producers to produce more and for buyers to buy less. A low price is a signal for producers to produce less and for buyers to buy more.

MARKETS AND MARKET STRUCTURES

What is a market? Market is any arrangement people have for trading with one another.

What do economists mean by the market structure? The conditions under which competition exists in a market are called/referred to a market structure.

What are the principal types of market structures? The principal kinds of market structures are perfect competition, monopolistic competition, oligopoly, and monopoly

What is perfect competition? Perfect competition (Pure competition): A market for uniform products in which there many buyers and sellers, no one of which is big enough to affect the price, and has full knowledge of market conditions.

What are the key characteristics of perfect competition?

• A large number of buyers and sellers all engaged in the purchase and sale of exactly the same commodity.

• Identical commodity offered for sale.

• Each buyer or seller has perfect knowledge of market prices and quantities.

• There are no barriers to entry or exit.

What is monopolistic competition? Monopolistic competition: A state of competition in a market in which many firms compete, producing similar but slightly differentiated products.

• What are the key characteristics of monopolistic competition?

• a large number of firms producing similar but not identical products;

• product differentiation;

• some restrictions of information about market prices and quantities of goods;

• a relatively easy entry to the market.

What is product differentiation? Product differentiation: A process of creating uniqueness in a product.

What is oligopoly? Oligopoly: A term applied to markets dominated by a few large firms.

What are the key characteristics of oligopoly?

The high cost of entry

patent protections

price leadership, collusion, and custom to determine pricing policies.

What is monopoly? Why does monopoly exist? monopoly is defined as a single firm producing unique products for which there are no close substitutes.

What is imperfect competition? Imperfect competition: A market in which there is neither pure perfect competition nor pure monopoly.

How does imperfect competition differ from perfect competition and monopoly? Imperfect competition describes markets in which sellers have more freedom to determine prices than they have under perfect competition, but less than they have under monopoly.

THE ECONOMY OF UKRAINE

1. When did Ukraine gain its independence? Ukraine gained its sovereignty in 1991 on the break up of the former Soviet Union.

2. What problems did Ukraine face at the beginning of its independence? When become independent the young country faced a number of simultaneous challenges and had to go through highs and lows¹ within the context of the Ukraine's transition to a market economy.

3. What are the biggest cities of Ukraine and what are they famous for? The world’s largest rocket factory is located in Dnipropetrovsk. Airplanes are produced by the world’s famous company named after Antonov. The best tanks are produced in Kharkiv. The main shipbuilding factories are based in Mykolaiv and Kerch.

4. What are the main industries of Ukraine’s economy? It has a major ferrous metal industry, producing cast iron², steel, and steel pipe, and its chemical industry produces coke, mineral fertilizers, and sulfuric acid³.

Which industries contribute to GDP of Ukraine most of all? What industries are the most export oriented? Coal and ore mining, chemical refining, and electricity production constitute 60 percent of GDP. Besides metals the main exports include: tractors, machinery, building materials, chemicals, consumer goods, crops and fertilizers.

4. What are the most important sectors of Ukraine’s industrial production? Ukraine's machine building produces ships, spacecraft, aircraft, locomotives, machine tools and mining equipment.

5. What are the most important branches of Ukraine’s agriculture? crop production, Cattle and pigs, Sheep and goats

6. What is the position of Ukraine in the world’s grain market? Grain output is almost 1 ton per person. Ukraine ranks as a leading wheat-growing country.

7. What are the main crops cultivated in Ukraine? What crops does Ukraine export? wheat, such grains as barley, corn, legumes¹, oats, rye², millet³, buckwheat⁴ are grown. Other food crops include potatoes, vegetables, melons, berries, other fruit, nuts, and grapes.

8. What are Ukraine’s main exports and imports? main exports and imports include: tractors, machinery, building materials, chemicals, consumer goods, crops and fertilizers.

9. What can promote a suitable climate for persistent growth of Ukraine’s economy? These account for higher potential for considerable progress in agricultural production.

What are the priorities of the government’s activity? foreign investments in agribusiness are also rather important for the country’s economy

4. What should be the priority of the government – Euro 2012, stable local currency, social protection or something else? Why? Prove you opinion.

BUSINESS ORGANIZATIONS

What are the advantages of this form of business organization? Advantages of a Sole Proprietorship

• A sole proprietorship is the least costly and easiest form of business organization to launch and operate.

• A sole proprietorship is a business in which the owner is fully and personally responsible for all the obligations of the enterprise.

• A sole proprietor is entitled to all the company’s profits and takes complete managerial control.

• A sole proprietor is free to make any business decision – what kind of business activities to choose, who to hire or fire, when to take a vacation, when to liquidate his or her business and so on.

• There is preferential tax treatment. It means that any profit earned from the business is considered a sole proprietor’s income. The owner pays only personal income taxes on the business’s profits, which are reported as personal income on the proprietor’s individual income tax return.

What are the disadvantages of a sole proprietorship?Disadvantages of a Sole Proprietorship

• Unlimited liability being the major disadvantage of a sole proprietorship means that a sole proprietor assumes the burden of any losses or liabilities the enterprise faces. A business owner is personally responsible for the company’s debts. It means that personal assets such as money from his bank account and the proceeds from the sale of his house can be taken to pay liabilities of the business.

• Limited resources refer to the owner’s personal financial resources and his or her ability to borrow.

• A sole proprietorship ends with a sole proprietor’s death.

What are the advantages of a partnership? Advantages of a Partnership

• A partnership is relatively easy and inexpensive to establish.

• There are more possibilities in raising funds because the borrowing power of two or more partners is greater.

• Each partner can benefit a partnership by his/her knowledge, skills or ideas and specializes in certain activities of the business.

• Like a sole proprietorship partnerships are subject to special tax treatment. Any profit of a partnership passes on to its owners, who report their portion of earnings on their personal income tax returns.

What are the disadvantages of a partnership?Disadvantages of a Partnership:

• A partnership has unlimited liability and if it is unable to meet its financial obligations, partners have to use their personal assets to pay off all the business’s debts.

• Profit sharing can excite controversy when one or more partners aren’t putting great efforts into the management of the business.

• Disagreements between the partners may cause management conflicts. Partners’ different ideas on how to run the company can lead to disagreements that are likely to harm its business activity.

• The partnership is terminated because of the withdrawal or death of a partner. If the business is to continue, a new partnership agreement must be drawn up.

What are the advantages of a corporation? Advantages of a Corporation:

• Limited liability is one of the major advantages of a corporation. Shareholders are not liable for the debts of a company they own shares in. If a business fails shareholders can lose no more than he or she has paid for the shares of stock but their personal assets – car, home, and personal bank accounts – are safe from the creditors of the business.

• Being a separate legal entity, the corporation actually owns and operates the business for the benefit of the shareholders, but under their total control.

• Shares of ownership are transferable. Stockholders can enter or leave a corporation at will simply by buying or selling shares of stock.

• Corporation has unlimited life. The corporation’s power of succession enables it to have a continuous existence. Unlike a sole proprietorship, the death of the corporate stockholders will not terminate the corporation, since their shares are passed on to their heirs.

• It is much easier for a corporation to increase capital to manage and expand its operations. To raise additional funds corporation attracts new stockholders by selling its new issues of shares to the public.

What are the disadvantages of a corporation? Disadvantages of a Corporation

• A corporation is difficult and expensive to create and organize. This process requires higher start-up capital and the services of a lawyer to obtain a government charter.

• Corporation is subject to double taxation. As a legal entity it pays a corporate income tax. Then, if the corporation distributes some of its net income to the stockholders as dividends, they are taxed again on the stockholders’ individual income tax returns.

THE ECONOMY OF THE UNITED STATES OF AMERICA

The United States has a mixed economy. The government does play an important part in the national economy. It provides services and goods that the market cannot provide effectively, such as nation defense, public goods and services, assistance programs for law-income families. And incentives to encourage the production and consumption o g certain types of products. The USA is the largest trading nation, exporting and importing more goods and services than any other country. US economy can be divided into four sectors. The first sector provides goods that come directly from natural resources. The second sector includes manufacturing of electricity. The third sector made up of commerce and services. The fourth sector deals with recording, processing, and transmission of information. Manufacturing is the key component of the US economy. The leading categories of the US manufactured goods are chemical, industrial machinery, electronic equipment, processed foods, and transportation equipment. The largest sector of the US economy in terms of output and employment is the service and commerce sector. The Internet began in the 1960s as a small network of academic and government computers primarily involved in research for the US military. The US communications systems are among the most developed in the world. The country's major mineral resources are gold, silver, iron ore, copper, lead, zinc, natural gas and coal. The nation’s favourable climate, soil and water conditions make the USA the world's richest agricultural nation. Cattle production, hog production, and chicken production are wide-spread throughout the United States. The high production levels do not satisfy all of the US demand for forest products, the United States has to import lumber. Rich fishing grounds of the country provide a rich marine harvest.

TAXATION

1. What are the main purposes of collecting taxes?

Without taxes to finance its activities, governments could not exist. Governments use tax revenues to pay soldiers and police, to build roads and bridges, to control schools and hospitals, to provide food to the poor and medical care to the elderly..the principal purpose of taxes is to pay for the cost of government.

2. What is a tax?

Tax: money compulsory levied by government on individuals, property, businesses.

3. What types of taxes do governments impose?

Governments impose many types of taxes. In most democracies, individuals pay income taxes when they earn money, consumption taxes such as excise tax, sales taxes, and value-added taxes when they spend it, property taxes when they own a home or land, and some others.

4. What are income and property taxes?

Property tax: a tax based on the value of property owned by the taxpayer.Income tax: a tax on the income earned by individuals and corporations.

5. What are sales and value-added taxes?

Sales tax: a regressive tax added to the price of goods and services at the time they are sold. Value-added tax is a tax levied on the value added to goods at every stage of production.

6. What excites considerable controversy when it comes to taxation?

7. What are the principles of taxation?

8. What does the benefits-received principle state?

Benefits-received principle of taxation: a form of taxation in which taxpayers pay according to the amount of benefits that they receive from government programs.

9. What does the ability-to-pay principle mean?

Ability-to-pay principle of taxation: a form of taxation in which taxes are levied on the basis of the taxpayer’s ability to pay

10. How can most taxes be classified? Define them.

Most taxes can be classified as proportional, progressive, or regressive.

11. Why do sales taxes and value-added taxes have a regressive effect?

12. A regressive tax takes a lower percentage of income as income rises - poor people pay a larger share of their incomes in taxes than rich people. Although both sales taxes and value-added taxes are not based on income, they have a regressive effect because they take a larger share of earnings from a low-income taxpayer than from a high-income taxpayer.

13. What is an incidence of the tax?

The way a tax affects people is called the tax incidence.

THE ECONOMY OF GREAT BRITAIN

1. What place does the United Kingdom hold in the world and in Europe?

The United Kingdom`s economy hold fourth largest economy in the world, the second largest in Europe

2. What is the United Kingdom composed of?

The United Kingdom is composed by the political union of four constituent entities¹: England, Scotland and Wales on the island of Great Britain and Northern Ireland on the island of Ireland.

3. What type of the economy does Great Britain have?

Great Britain has a mixed private and public enterprise economy

4. What does the government do to make the British economy more efficient?

To make the British economy more efficient the government tries to stimulate innovations in industry, encourage competition, reduce taxes, promote exports, and work for world­wide free trade.

5. What has been a key part of British economy for centuries?

Trade has been a key part of the British economy for centuries.

6. What has its prosperity been dependent upon?

Its prosperity has been dependent upon the export of manufactured goods in exchange for raw materials and foodstuffs.

7. What can you say about the international trade of Great Britain?

Its trade with Germany, United State, France, Netherlands, Ireland and other

8. What does Great Britain export and import?

The country’s chief exports are manufactured goods such as electrical and electronic equipment, aerospace equipment, machinery, chemicals, textile fibers, fuels, iron and steel, and transport equipment. The leading imports are manufactured and consumer goods, foodstuffs, industrial and electrical machinery, semi-finished goods, cloth­ing and accessories, office machines and data processing equip­ment, and transport equipment.

9. What sectors can the British economy be divided into? What does each deal with?

British economy can be divided into three main sectors:

1. Primary industries)that deal with providing raw materials and food from the land and the sea (energy resources, agriculture, forestry, fishing and water supply) — 13%.

2. Manufacturing industries that deal with making finished goods from raw materials (electronics, aerospace, chemical, plas­tics, paper and printing industries) — 22%.

3. Service industries that deal with providing a wide variety of services (banking, insurance, computing, tourism etc) — 65%.

10. Why is the country self-sufficient in energy?

By successfully exploiting oil and gas from the North Sea Britain has become self-sufficient in energy.

11. What mineral resources does the country possess?

Great Britain possess such mineral resources as iron ore, tin, limestone, salt, china clay, gypsum, and lead.)

12. What is British agriculture known for?

The British agriculture is known for its high efficiency and productivity according to European standards and based on mod­ern technology and research.

13. What are British farms engaged in?

three-fifths of farms are engaged in dairy or beef cattle breeding and sheep-raising.

14. Production of what goods does manufacturing cover?

It is a broad category of output covering pro­duction of textiles, wood and metal products, paper, plastics, rub­ber, vehicles, machinery and equipment, and a host¹ of other pro­duced goods.

15. What new industries has Britain made important advances in?

Britain has made important advances in electronics and telecommunications equipment, air­craft and aircraft engines, radio-isotopes and new medicines.

16. Why does Great Britain remain one of the most highly industrialized countries of the world?

Thanks to the increasing use of intensive methods and modern technologies Great Britain remains one of the most highly industrialized countries of the world.

17. Why is electronic data-processing equipment growing? What are the main electronic consumer goods produced in the UK?

Electronic data-processing equipment is a growing industry. Britain has originated a lot of advanced technologies in micro­electronics. The main electronic consumer goods produced are tel­evision sets with an increasing proportion of widescreen and dig- italsets, electronic control equipment

18. What can you say about the central bank of England? What is it responsible for?

The Bank of England, as the central bank, was nationalized in 1946 and is the bank of issue in England and Wales. It is respon­sible for the monetary policy of the country and also manages the country’s foreign exchange and gold reserves.

19. What is the basic unit of currency in Britain? What did the British government decide about euro?

The pound sterling (&1) is the basic unit of currency in Britain. the British government decided-not to adopt the euro and to keep the pound as its currency.

20. Why does government support and promote tourism?

Government supports and promotes tourism? Because it employs about 1.5 milliqn (7%) of the workforce and contributes about 3.5% to the GDP.

21. What can you say about the London Underground?

the system serves 275 stations, with more than 500 trains running during peak periods.The underground provides reliable public transportation for an impressive number of commuters across a larger metropolitan area. Glasgow, Liverpool, Tyne and Wear, Manchester, and Sheffield have their own urban rail system“.

MONEY

What is money?

money is anything that is generally accepted in payment for goods and services, and debts and makes the trading process simpler and more efficient.

What money are people most familiar with?

Nowadays the money people are most familiar with is currency that people use almost daily.

What is currency?

Currency is legal tender. This means the law requires that it must be accepted in settlement of debts. Currency refers to all coins and paper money issued by the central bank of a nation and held by the public within a country.

modern money should have the following characteristics:

• Stability. The value of money should be more or less the same today as tomorrow. In societies where the value of money fluctuates people will store it in the hope its value will increase, or spend it immediately thinking it will be worth less tomorrow.

• Portability. Modern money has to be small enough and light enough for people to carry. It especially relates to checkbooks. Check can be written in almost any amount.

• Durability. Money has to have a reasonable life expectancy. So, durability means that modern money is made of a very high quality material that makes it possible to be in circulation over a long period of time.

• Uniformity. Equal denominations of money should have the same value.

• Divisibility. One of the principal advantages of money is its ability to be divided into parts. In other words, it is easy to make change for a large denomination.

• Recognizability. Money should be easily recognized for what it is and hard to copy.

Since money is best defined in terms of what it does, the economists describe money in terms of its three basic functions - the needs it fulfills in every society. Money serves these functions regardless of its name or form – U.S. dollar, Japanese yen, Ukrainian hryvna.

How does money function?

The most important and the most easily understood function of money is to serve as a medium of exchange. a function of a measure of value money, a store of value.

What is money as a Medium of exchange?

When money is used as a medium of exchange, it distinguishes from other assets

How does money perform a function of a Measure of value?

When performing a function of a measure of value money is used as a common denominator of value for pricing goods and services. The use of money as a measure of value helps make rational market decisions.

What does money mean as a Store of value?

Money as a store of value enables people to use the value of something that they sell today to make a purchase sometime in the future.

What does the purchasing power of money mean?

purchasing power means the amount of goods and services people can buy with their money. When prices increase, money cannot buy as much. Its purchasing power declines.

Why and when does the value of money change?An extended period of rising prices is called inflation. Economists distinguish two general types of inflation – demand-pull inflation and cost-push inflation.A period in which prices are falling is called deflation. The value of the monetary unit increases during periods of deflation.

1) Багато нових будинків будують зараз у нашому місті.

Many new buildings are building in our town.

2) Бувало він викурював 20 цигарок на день.

He used to smoke 20 cigarettes a day.

3) В кімнаті хтось був.

There was somebody in the room.

4) В нашій країні не має нафти.

There is no oil in our country.

5) В січні буде дуже холодно.

It will be very cold in January.

6) Вам доведеться зачекати десять хвилин.

You’ll have to wait 10 minutes.

7) Вам потрібно відремонтувати квартиру?

Do you need your apartment to be repaired?

8) Вам треба було звернутися до лікаря раніше.

You should have visited doctor earlier.

9) Ви вже написали листа батькам?

Have you already written the letter to your parents?

10) Ви захворіли. Вам слід звернутися до лікаря.

You have got sick. You should to go to the doctor.

11) Ви можете взяти мою парасольку.

You may take my umbrella.

12) Ви не заперечуєте, якщо я закрию вікно?

Don’t you mind me closing the window?

13) Ви не повинні фотографувати в картинній галереї.

You shouldn’t photograph in pain gallery.

14) Ви не проти мого від'їзду?

Don’t you mind my leaving?

15) Вибачте за те, що я загубив вашу книгу.

Excuse me for loosing your book.

16) Відомо, що зустріч почнеться цього ранку.

Meeting is known begin this morning.

17) Він вийшов з кімнати не звертаючи уваги на нас.

He left without painting attention to us.

18) Він дивився цей фільм вже декілька разів.

He has already watched this film several times.

19) Він завжди п‘є зранку каву, але сьогодні він п‘є чай.

He always drinks coffee in the morning, but today he is drinking tea.

20) Він запитав мене котра година.

He asked me what time it was.

21) Він може читати будь-яку літературу англійською мовою.

He can read any literature in English.

22) Він не мав наміру обговорювати з нами цю подію.

He was not intended to discourse with event with us.

23) Він повернеться через два дні.

He’ll be come in two days.

24) Він показав нам список товарів, що експортуються їхньою фірмою.

He showed us the list of goods that were exported.

25) Він приїде, якщо складе всі іспити.

He’ll come, if he passes all his exams.

26) Він раптом зрозумів, що йде не вту сторону.

Suddenly he understood that he was walking a wrong.

27) Він розірвав листа на шматочки не читаючи.

He tore the letter into pieces without reading.

28) Він сказав, що Мері сказала йому, що вона пише нову книгу.

He said that Mary had told him, that she was writing a new book.

29) Він сказав, що повернеться через дві години.

He said that he would be back in two hours.

30) Він спитав мене, про що вони розмовляють.

He asked me what they were talking about.

31) Він ще не закінчив свою роботу.

He has not finished his work.

32) Він, здається, багато знає про цього видатного актора.

He seems to know much about this known actor.

33) Вісімдесят відсотків людського тіла складає вода.

80 per cent of a human body consists of water.

34) Вона була вимушена перекласти цю статтю двічі, так як зробила багато помилок

She was made translate this article twice, because she made many mistake.

35) Вона була схожа на свою старшу сестру - мала таке ж руде волосся та великі очі.

She looked like her sister – she had the same red hair and big eyes.

36) Вона думала, що її діти граються вдома.

She thought that her children were playing at home.

37) Вона запитала, чи мені подобається ця стаття.

She asked, if I liked that article.

38) Вона знала, що він ніколи не був у Москві.

She knew that he had never been to Moscow.

39) Вона невпевнена, що вони приїдуть сьогодні вечором.

She is not sure, if they will come tomorrow.

40) Вона пішла на роботу, залишивши дитину з бабусею.

She went for job, having left a child with grandmother.

41) Вона працює в університеті двадцять років.

She has been working in the University for 20 years.

42) Вона робить зачіску щотижня.

She makes her hair-do weekly.

43) Вона саме розмовляла по телефону коли хтось розбив на кухні чашку.

She was just speaking over the telephone, when somebody broke a cup in the kitchen.

44) Вона сказала йому, що він може йти додому.

She told him, that he could go home.

45) Вона сказала, що повернеться через тиждень.

She said, that she would come in a week.

46) Вона чула як хтось підійшов до дверей.

She heard somebody come to the door.

47) Все було зроблено, щоб допомогти йому.

Everything was made to help him.

48) Все було підготовлено до п’ятої години вечора.

Everything had been prepared till 5 o’clock in the evening.

49) Всі будуть здивовані, якщо він зробить таку помилку.

Everybody will be surprised if he makes such a mistake.

50) Георгій сказав, що йому було дуже важко зіграти цю роль.

Gеogre said that it had been very difficult for him to play this part.

Діти повинні спати дев’ять годин на добу.

The children are to sleep 9 hours per day.

До кінця цього тижня його ім‘я буде відоме кожному.

His name will have been known for everybody till the end of this week.

До п’ятої години вечора її брат прочитав половину книги.

His brother has read a half a book till 5 p.m.

Документи буде перевірено, а лист підписано до того часу, коли він прийде.

The documents will have been cheeked up, and the letter will have been signed till he comes.

Дощ іде з самого ранку.

It has been raining since morning.

Дякую вам за те, що допомогли мені. ( за вашу допомогу)

Thank you for your helping.

Женя звичайно говорить так швидко, що я її не розумію.

Janie use to talk so quickly that I don’t understand her.

Жінка, яка працює в саду-моя сестра.

The women, working in the garden is my sister.

З ким ти поїдеш до Канади?

With whom are you going to Canada?

Замість того, щоб піти в кіно, він залишився вдома.

Instead of going to the cinema he stayed home.

Здається, збирається на дощ.

It seems to be raining.

Здається, що вона говорить правду.

She seems to talk truth.

Зрозумівши свою помилку, він перестав сперечатися.

Hawing understood his mistake he stopped to dispute.

Ішов сніг, коли ми вийшли.

It was showing, when we went out.

Її попросили заспівати цю пісню.

She was asked to sing this song.

Йому дадуть цей журнал в понеділок.

This magazine will be given him on Monday.

Йому слід потурбуватися про своїх батьків.

He ought to take care about his parents.

Кажуть, що цей чоловік, був дуже гарним коли був молодим.

This man is said to be very beautiful when he was yang.

Кіт був наказаний за те що розбив чашку.

The cat was punished for broken a cup.

Коли батько прийшов, всі сіли обідати.

When father had came everybody set having dinner.

Коли ви переклали цей текст?

When have you translated this text?

Коли ви повернетесь додому, я буду вже працювати сім годин.

When you came home I’ll have been working for 7 hours.

Коли у тебе будуть наступні канікули?

When will you be on your next vacation?

Коли я зайшла до кімнати, діти сиділи за столом та грали в шахи.

When I came into the room kids were sitting at the table and playing chess.

Коли я обідав, хтось подзвонив мені на мобільний телефон.

When I was having a dinner somebody call me on mobile phone.

Куди ти ходиш на прогулянку, якщо в тебе є вільний час.

Where do you go walking when you have a free time?

Купивши книгу, він почав читати.

Having bought the book he started reading.

Лекції цього професора завжди слухають з величезною зацікавленістю.

The lections of this professor are always listened to with grate pleasures.

Листи ще не відправили.

The letters haven’t been sent yet.

Мама запитала, коли я від’їжджаю до Лондона.

Mama asked when I would go to London.

Мати сказала, що вона закінчить роботу через двадцять хвилин.

Mama said that she would finish this work in 20 minutes.

Машини не можна паркувати навпроти входу.

The cars may not be parked next to the entrance.

Мері раділа, що вже здала всі екзамени.

Mary was glad that she had already passed all exams.

Ми зупинилися, щоб перепочити.

We stopped to have a rest.

Ми можемо розглянути це питання в понеділок.

We can consider this question on Monday.

Ми очікуємо, що контракт буде підписаний завтра.

We expect the contract to be signed tomorrow.

Ми сіли на землю покриту сухим листям.

We set on the ground covered dead leafs.

Ми спостерігали, як туристи переходили річку.

We watched the tourists crossing the river.

Ми хотіли довідатися, о котрій годині прибуває поїзд.

We went to find out then the train arrived.

Ми чекатимемо на вас тут, якщо ви не будете заперечувати.

We’ll waiting for you’re here, if you don’t mind.

Микола хворів вже цілий тиждень, коли ми прийшли провідати його.

Mike had been seeking for a week when we came to see him.

Мій батько працює п'ять днів на тиждень.

My father works 4 days per week.

Мій дідусь на пенсії вже п’ять років.

My grandfather has been on pension for 5 years.

Мій друг, здається, добре проводить час на березі моря.

My friend seems to be spending his time on seaside greatly.

Мій старший син пішов уже на роботу.

My older sun has already got a job.

Можливо він спізнився на концерт.

He may be late to the concert.

Мої батьки звикли вставати рано.

My parents are use to getting up early.

Нам важко виконати це завдання в такий короткий термін.

It’s difficult for us to do this task in such short terms.

Нам показали новий фільм.

A new movie has been showing for us.

Наш новий знайомий виявився відомим ученим.

Our new fellow proved to be a famous scientist.

Не лізь на дерево! Ти впадеш та заб’єшся.

Не одержавши відповідь на свій лист, я дуже засмутився.

Having not dot a replay for my letter I was upset.

Ніколи не бачили, щоб мати сердилася.

My mother has never been seen angry.

Ніку наказали зразу ж йти додому.

Nick has been ordered to come home in no tame.

Ніхто не помітив, як вона зайшла до кімнати.

Nobody noticed her come in to the room

Обидві сторони вважають, що переговори не будуть легкими.

Both sides suppose, that talks won’t be easy

Обід подавали коли ми повернулись.

The diner was being served, when we returned.

Оскільки гра була закінчена, хлопці пішли додому.

The game having finished, the boys went home.

Оскільки мій брат взяв ключ, я не зміг увійти до будинку.

My brother having took the key. I wasn’t able to come in to the house

Оскільки погода була холодна, йому довелося одягнути пальто.

The weather having being cold. He had to wear a coat.

Оскільки погода хороша, то всі вікна були відчинені.

The weather is fine the windows are open.

Оскільки я працював цілий день на сонці, я почував себе дуже стомленим.

I having worked the whole day on the sun. I felt my self very tiered

Очікують, що скоро надрукують багато підручників.

A lot of books are expected to be printed

Петро перечитав правило декілька разів, щоб краще зрозуміти його.

Peter read the rule more then once to understand it.

Після закінчення університету вона працювала на заводі.

After graduating the university she worked at the plant.

Побачивши незнайому людину, хлопчик дуже злякався.

Hewing looked the unknown man, the boy was afraid.

Повідомили, що екзамен з англійської мови відбудеться в кінці червня.

The exam is reported to be in the end of June.

Повідомте мене, коли щось трапиться.

Inform me when something happens.

Погода була сонячною минулого тижня.

The weather was shiny last week

Погода, напевно, зміниться.

The weather seems to change

Пробачте, що я знову вас турбую.

Excuse for my troubling you again

Програвши двічі, він не захотів пробувати знову.

Having loosen twice, he did not want to try again.

Робота запропонована мені здавалась дуже цікавою.

The work offered me is very interesting.

Роботу буде закінчено до наступного тижня.

The work will have been finished till next week.

Сандру не запросили вчора на вечір.

Sandra wasn’t invited yesterday to the party.

Скільки студентів у вашій групі?

How many students are in you group?

Сніг іде вже дві години.

If has been snowing for 2 hours.

Стаття, що зараз друкується, буде опублікована завтра.

The article being printed now will be published tomorrow.

Студенти вже складуть іспити до першого липня.

The students will have passed the exams by the first of July.

Те, що вона була відсутня, здивувало вчителя.

Her absent was surprised the teacher

Тетяна працює на цій роботі з півроку.

Tanya has been working at this work half a year.

Ти залишишся в місті, чи поїдеш куди - небудь.

Do you stay in the town or go somewhere.

Ти хочеш, щоб я прийшла раніше?

Do you want me come earlier?

Треба бути завжди ввічливим.

It is necessary to be polite always.

У мене був велосипед, але його вкрали.

I had a bicycle beet it was stolen.

У мене буде можливість побачити його завтра.

I’ll have a possibility to see him tomorrow.

Хтось телефонував тобі сьогодні й хотів розповісти щось цікаве.

Somebody has rung up you today end wanted to tell you something interesting.

Це гарний фільм? Так це найкращий фільм який я коли небудь бачив.

Is it fine film? Yes, it is the best film I have ever seen.

Це головна проблема, яку потрібно вирішити негайно.

It is the main problem to be solved rite now.

Це книга, яку ти дійсно повинен прочитати.

It is the book you must really read.

Це місто варто відвідати.

This town is worth visiting.

Це стаття, яку негайно треба перекласти.

This article has to be translated ride now.

Цей лист щойно підписаний директором.

This letter has been just signed by the director.

Цей текст найскладніший із усіх текстів, які ми коли-небудь перекладали.

This text is the most hard we have ever translated.

Ці товари варто купити.

These commodities are worth buying.

Цю газету шукали в кімнаті.

This newspaper was looked for in the room.

Цю річ варто купити.

This thing is worth being.

Чесно кажучи ви могли б і розповісти мені про це.

To be honest, you could tell me about this.

Чи багато риби в цій річці?

Are there a lot of fishes in this river?

Чи можемо переходити вулицю, коли світло червоне?

Can we cross the street if the light is red?

Чи скоро покажуть цей фільм по телевізору?

Is this film soon shown on TV?

Чому ти не зателефонував йому вчора? Тому, що я з ним посварився.

Why did you not phone him yesterday? Because, I had quarreled with him.

Чули, що він повторив ці слова декілька разів.

He was heard repeated these words several times.

Що будують по той бік річки.

What is built the opposite side of the river?

Що ви робите в бібліотеці? Я готую доповідь.

What are you doing in the library I’m preparing the report.

Що примусило вас зробити цей крок?

What make you do this step?

Що ти будеш робити коли вони запропонують тобі роботу?

What will you do when they offer the work for you?

Щоб виконати це завдання йому знадобиться з півгодини.

To make this task, he need half an hour.

Я б хотіла, щоб ви пояснили мені це ще раз.

I want you to explain me it once more.

Я бачив, що вона відкрила двері і вийшла.

I saw her open the door end come out.

Я вважаю, що він відповідальний за це.

I think he is responsible for it.

Я взяв газету, що лежала на столі.

I took the newspaper laid on the table.

Я загубив зошит і мені довелося купити новий

I had last the exercise book end I had to buy a new one.

Я звик жити з батьками, але зараз я живу один у своїй власній квартирі.

I get used to live with parents, but now I live alone in my own flat.

Я звик приходити додому о 10 вечора.

I get used to come home at 10 o’clock in the evening.

Я зможу повернути вам вашу доповідь через тиждень.

I’ll be able to return your report in a week.

Я знав, що всі фінансові документи підписуються директором.

I knew that a principal signed all financial documents.

Я знав, що мій друг ніколи не був в Англії.

I know that my friend had never been to England.

Я на п’ять років старший від своєї сестри.

I’m 5 years elder than a sister.

Я не був упевнений, що ця робота буде зроблена вчасно.

I wasn’t sure that this work would be done on time.

Я не вірю, що це правда.

I don’t believe that it is true.

Я не думаю, що ми зможемо закінчити переклад на англійську мову сьогодні.

I don’t thing that we are able to finish translating in to English today.

Я не заперечую проти того, що ви приїхали сюди.

I don’t mind your coming here.

Я не могла не звернути уваги на те, що він розповів.

I couldn’t help attracting attention on what he had told.

Я не повинен приймати цю пропозицію.

I shouldn’t accept this suggestion.

Я не хочу, щоб мене турбували кожний день.

I don’t want wont to be disturbed everyday.

Я нікого не чекаю сьогодні ввечері.

I don’t wait for anybody to night.

Я нічого не маю проти того, щоб подивитися цей фільм ще раз.

I don’t mind watching this movie one more.

Я певен, вона прийде.

I’m sure she’ll come.

Я повинен негайно відіслати гроші додому.

I have to send many at home immediately.

Я повинна знати про що ти говориш?

I mast know what are you talking about.

Я повинна йти зараз, я не хочу запізнюватись.

I have to go now because I don’t want to be late.

Я роблю зачіску щотижня.

I make a hair weekly.

Я спостерігав, як вони ремонтували машину.

I watched them repairing a car.

Я хотів бути пілотом, коли був молодим.

When I was yang I wanted to be a pilot.

Я хочу, щоб ви дали мені інформацію.

I want you to give me same information.

Я хочу, щоб мені відремонтували пральну машину.

I want to have my washing machine repaired.

Як довго ти чекаєш на мене?

How long have you been waiting for me.

Як ти допомагала своїй сестрі минулого літа?

How did your sister last summer.

Як тільки концерт закінчився ми пішли додому.

As soon as the concert had finished we went home.

Як часто він стрижеться?

How often does he cut his hair?

Яке правило пояснює вчитель.

What rule are being explained by the teacher.

Яку пісню вони співають зараз?

What song are they singing now?

Якщо ви бажаєте поліпшити свій англійський, вам треба багато працювати.

If you want to change your English for better, you need to work hard.

Якщо ви вдягнете окуляри, ви будете краще бачити.

If you wear the glasses you’ll be able to see letter.

Якщо ви залишитеся тут трохи довше, то побачите його.

If you stay here for a while we’ll meet him.

Якщо ви одягнете теплий одяг ви не застудитесь.

If you take the warm clothes you won’t ketch a cold.

Якщо ви передзвоните мені завтра, ми вирішимо вашу проблему.

If you recall me tomorrow we’ll solve your problem.

Якщо ви прийдете до мене, я буду дуже рада.

If you came to me I’ll be very glad.

Якщо він мені не зателефонує, ми відправимо йому телеграму.

If doesn’t call me, we’ll send him a telegram.

Якщо він прийде пізно, ми підемо без нього.

If he comes late, we’ll go without him.

Якщо вони нам допоможуть, ми прийдемо без запізнення.

If they help us, we’ll go without delay.

Якщо дитина захворіє, мати викличе лікаря.

If a child gets seek, mother will call for a doctor.

Якщо обставини дозволять, ми поїдемо завтра.

If circumstances allow we’ll go tomorrow.

Якщо ти зателефонуєш мені, то я піду з тобою на прогулянку.

If you call me I’ll go with you for a walk.

Якщо ти зустрінеш її завтра, вона допоможе тобі.

If you meet her tomorrow she will help you.

Якщо тобі сподобається ця книга, ти купиш її?

If you enjoy this book will you buy it?

Якщо ціна на цей продукт підніметься, ніхто його не купить.

If the price for this product rises nobody will buy it.

Якщо я зустріну її, я запрошу її на вечірку.

If I meet her, I’ll invite her to the party.

Якщо я отримаю цю інформацію вчасно, я використаю її.

If I get this information on time, I’ll use it.

What is economics about

Studying economics for the first time, it is necessary to know what economics is all about¹. Unfortunately, it is not possible to define the subject by a single word. Economics was defined as the study of mankind in the everyday business life. This means that economics deals with production, distribution, exchange and consumption. It answers such questions as: How do we produce all the things we need? How are prices determined? Economics is also concerned with² unemployment, inflation, international trade, the interaction of business and labour, and the effects of government spending³ and taxes.. Economics is a social science like history, geography, politics, psychology and sociology. It is the study of human efforts to satisfy what seems like unlimited and competing wants⁴ through the careful use of relatively scarce resources. Economists study what is or tends to be and how it came to be. They do not in any way pretend to tell what ought to be. People must make up their own minds⁵ about that. Economics is therefore concerned with activities relating to wealth, i.e. production, consumption, exchange and distribution.

For our own purpose, we shall define economics as the study of man in his attempts to gain a living⁶ by utilizing his limited resources. Economics like any other social science has its own vocabulary. To understand economics, a review of some key terms¹ is necessary: needs², wants³, and demands⁴. A need is a basic requirement for survival. People have basic needs such as food, clothing and shelter. People also have higher level needs, such as communication, love, acceptance, knowledge, hope and accomplishment.

A want is a means of expressing a need. Food, for example, is a basic need related to survival. To satisfy this need, a person may want a pizza, hamburger or other favourite food. That is there are any number of foods that will satisfy the basic need for food. The point is⁵ that the range of things represented by the term «want» is much broader than those represented by the term «need». Sometimes the difference between a want and a need is clear, at other times, it is not. A basic need is reflected in a want for a particular product⁶. A want cannot be counted in the marketplace until it becomes a demand — the willingness and ability to purchase a desired object. Since an individual has limited resources, only some wants will end up as measurable demands⁷. The study of economics is concerned with economic products — goods and services that are useful, relatively scarce and transferable to others. The important thing is that economic products are scarce in an economic sense. That is one cannot get enough to satisfy individual wants and needs¹. The fact that economic products command a price shows that they have these characteristics.The terms goods and services are used to describe many things people desire. Consumer goods are intended for² final use by individuals to satisfy their wants and needs. Manufactured goods used to produce other goods and services are called capital goods³. An example of capital goods would be a computer in a school. The other type of economic product is a work that is performed for someone. Services can include haircuts, repairs to home appliances⁴ and forms of entertainment like rock performances. They also include the work performed by doctors, lawyers and teachers. The difference between goods and services is that the services are something that cannot be touched or felt like goods. Many other things — sunshine, rainfall, fresh air — are known as free products⁵ because they are so plentiful. No one could possibly own them, nor would most people be willing to pay anything for them. In fact, some are so important, that life would be impossible without them. Even so, free products are not scarce enough to be major concern in the study of economics. In economics the term value means something having a worth that can be expressed in dollars and cents. Someone may say, for example, that he or she has a valuable coin, the value is determined by the price someone would pay for the collection. But what makes some things worth more than others?¹ The diamond-water paradox, also known as the paradox of value, helps answer this question. Early economists observed, that some things like water were essential to life, yet had little monetary value². Other things, like diamonds, were not essential but had higher value. Later economists decided that part of the reason was due to³ scarcity. For example, water is so plentiful in many areas that it has little or no value. On the other hand, diamonds are so scarce that they have great value. In order to have value, it has to be somewhat scarce. Scarcity, however, is not enough. If something is to have value, it must also have utility, or the capacity to be useful to someone. Utility is not something that is fixed and can be measured like weight or height. Instead, the utility of goods or services may vary from one person to the next. One person may, for example, get a great deal of⁴ enjoyment from a home computer, another may get very little. In the end, for something to have value, it must be scarce and have utility. Another economic concept is wealth — the sum of those economic products that are tangible, scarce, useful and transferable from one person to another. Most economic goods are counted as wealth, but services are not. The reason for this is that it is difficult to measure the value of services accurately. For example, it is difficult to measure the contribution made by people’s abilities and talents to a nation’s wealth. A country’s total worth, then is the stockpile of useful scarce⁵, tangible things⁶ in existence at a given time. National wealth includes all such items as natural resources, factories, stores, houses, theatres, books, video games etc.

Factors of production

The reason people cannot satisfy all their wants and needs¹ is the scarcity of productive resources. These resources or factors of production² are called land, labour, capital, and organization or entrepreneurship³. They provide the means for a society to produce and distribute its goods and services.

As an economic term land means the gifts of nature⁴ or natural resources not created by human efforts. They are the things provided by nature that go into the creation of goods and services. Land has a broad meaning. It is not only land itself, but also what lies under the land (like coal and gold), what grows naturally on top of the land (like forests and wild animals), what is around the land in the seas and oceans and under the seas and oceans (like fish and oil). It includes deserts, fertile fields, forests, mineral deposits, rainfall, sunshine and the climate necessary to grow crops.

Because there are only so many natural resources available at any given time, economists tend to think of land as being fixed or in limited supply. There is not enough good farmland to feed all of the earth’s population enough, sandy beaches for everyone to enjoy, or enough minerals to meet people’s expending energy needs indefinitely.

The second factor of production is labour — people with all their efforts and abilities. Unlike land, labour is a resource that may vary in size over time. Historically, factors such as population growth, immigration, famine, war and disease have had a dramatic impact⁵ on both the quantity and quality of labour.

Labour is the human input into the production process. It may be mental or physical. But in many tasks it is necessary to combine mental activity with physical effort. The price paid for the use of labour is called wages⁶. Wages represent income⁷ to workers, who own their labour. Land and labour are often called primary factors of production⁸. It is one whose quantity is determined outside the economy.

The third factor of production is capital — the tools, equipment and factories used in production of goods and services. It is a produced factor of production, a durable input which is itself an output¹ of the economy. For example, we build a textile factory and use it to produce shirts, or assemble a computer and then employ it in educating students.

As noted earlier, such items are also called capital goods². This is to distinguish them from financial capital³, the money used to buy the tools and equipment used in production.

Capital is unique in that, it is the result of production. A bulldozer may be an example of capital goods used in construction. At the same time⁴, it was manufactured in a factory which makes it the result of earlier production.

When the three inputs⁵ — land, labour and capital — are present, production or the process of creating goods and services, can take place. Even the production of the service called education requires the presence of land, labour and capital.

Entrepreneurship, the managerial or organizational skills⁶ needed by most firms to produce goods and services, is the fourth factor of production. The entrepreneur brings together the other three factors of production — land, labour and capital. When they are successful, entrepreneurs earn profits⁷, the return or reward⁸ for the risks, innovative ideas and efforts put into the business. When they are not successful, they suffer losses⁹.

Money

Basically, money is what money does. This means that money can be any substance¹ that functions as a Medium of Exchange, a Measure of Value, and a Store of Value.

As a medium of exchange, money is something generally accepted as² payment³ for goods and services

As a measure of value, money expresses worth in terms that most individuals understand.

Money also serves as a store of value. This means goods or services can be converted into⁴ money that is easily stored until some future time.

The different forms of money are in use in the United States today. The most familiar are coin and currency. The term coin refers to metallic forms of money. The term currency refers to paper money issued by government. While money has changed in shape, kind or size over the years, modern money still shares many of the same characteristics of primitive money. Modern money is very portable⁵ when people carry checkbooks. For example, they really are carrying very large sums of money since checks can be written in almost any amount.

Modern money is very durable⁶. Metallic coins last a long time under normal use⁷ and generally do not go out of circulation⁸ unless they are lost. Paper currency also is reasonably durable. Modern money also rates high in divisibility⁹. The penny which is the smallest denomination of coin¹⁰, is more than small enough, for almost any purchase. In addition, checks almost always can be written for the exact amount. Modern money, however, is not as stable in value. The fact, that the money supply¹¹ often grew at a rate 10 to 12 per cent a year was considered as major cause of inflation

Economic systems

The survival of any society depends on its ability to provide food, clothing and shelter for its people. Since these societies are also faced with scarcity decisions concerning What, How and for Whom to produce must be made.

All societies have something else in common. They have an economic system or an organized way of providing for the wants and needs of their people. The way in which these decisions are made will determine the type of economic system they have. There are three major kinds of economic systems: traditional, command and market.

Traditional Economy

In a society with a traditional economy nearly all economic activity is the result of ritual and custom. Habit and custom also prescribe most social behaviour¹. Individuals are not free to make decisions based on what they want or would like to have. Instead, their roles are defined. They know what goods and services will be produced, how to produce them, and how such goods and services will be distributed.

An example of traditional economy is the society of polar eskimo² of the last century. For generations, parents taught their children how to survive in a harsh climate, make tools, fish and hunt. Their children, in turn, taught these skills to the next generation. The main advantage of the traditional economy is that everyone has a role in it. This helps keep economic life stable and community life continuous. The main disadvantage of the traditional economy is that it tends to discourage³ new ideas and even punishes people for breaking rules or doing things differently. So it tends to be stagnant⁴ or fails to grow over time⁵.

Other societies have a command economy — one where a central authority makes most of the What, How and for Whom decisions.

Economic decisions are made at the top and people are expected to go along with¹ choices made by their leaders. It means that major economic choices are made by the government. It decides goals for the economy and determines needs and production quotas for major industries. If the planning body wants to stress growth of heavy manufacturing, it can shift resources² from consumer goods to that sector. Or, if it wants to strengthen national defence, it can direct resources from consumer goods or heavy manufacturing to the production of military equipment and supplies.

The major advantage of a command system is that it can change direction drastically in a relatively short time. The major disadvantage of the command system is that it does not always meet the wants and needs of individuals.

The second disadvantage of the command economy is the lack of incentives³ that encourage people to work hard. In most command economies today workers with different degrees of responsibility receive similar wages. In addition⁴, people seldom lose their jobs regardless of⁵ the quality of their work. As a result, there is a tendency for some to work just hard enough to fill production quotas set by planners.

The command economy requires a large decision-making bureaucracy. Many clerks, planners, and others are needed to operate the system. As a result, most decisions cannot be made until a number of people are consulted, or a large amount of paperwork is processed. This causes production costs⁶ to increase and decision-making to slow down. Thus, a command system does not have the flexibility to deal with day-to-day problems.

In a market economy, the questions of What, How and for Whom to produce are made by individuals and firms acting in their own best interests. In economic term a market is an arrangement that allows buyers and sellers to come together to conduct transactions¹.

Since consumers like products with low prices and high quality, producers in a market economy will try to supply such products. Those who make the best products for the lowest prices will make profits² and stay in business³. Other producers will either go out of business or switch to⁴ different products consumer can buy.

A market economy has several major advantages that traditional and command economies do not have. First, a market economy is flexible and can adjust to change over time.

When gas prices in the United States began to level off in 1985 and then decline in 1986, the trend slowly began to reverse.

The second major advantage of the market economy is the freedom that exists for everyone involved. Producers are free to make whatever they think will sell. They are also free to produce their products in the most efficient manner. Consumers on the other hand are free to spend their money or buy whatever goods and services they wish to have.

The third advantage of the market economy is the lack of significant government intervention. Except for national defence, the government tries to stay out of the way⁵. As long as there is competition among producers, the market economy generally takes care of itself.

The final advantage of the market economy is the incredible variety⁶ of goods and services available to consumers. In fact, almost any product can and will be produced so long as there is a buyer for it.

Demand

Most people think of demand as being the desire for a certain economic product. That desire must be coupled with¹ the ability and willingness to pay. Effective demand, that is desire plus ability and willingness to pay, influences and helps to determine prices.

In economics the relationship of demand and price is expressed by the Law of Demand. It says that the demand for an economic product varies inversely² with its price. In other words, if prices are high the quantities demanded will be low. If prices are low the quantities demanded will be high.

The correlation between demand and price does not happen by chance³. For consumers price is an obstacle to buying, so when prices fall, the more consumers buy.

The demand for some products is such that consumers do care about changes in price when they buy a great many more units of product because of a relatively small reduction in price. The demand for the product is said to be elastic⁴.

For other products the demand is largely inelastic. This means that a change in price causes only a small change in the quantity demanded. A higher or lower price for salt, for example, probably will not bring about⁵ much change in the quantity bought because people can consume just so much salt.

Even if the price were cut in half⁶, the quantity demanded might not rise very much. Then too, the portion of a person’s yearly budget that is spent on salt is so small that even if the price were to double⁷, it would not make much difference in the quantity demanded.

Elasticity of supply¹, as a response to changes in price, is related to demand. Economists define demand as a consumer’s desire or want, together with his willingness to pay for what he wants. We can say that demand is indicated by our willingness to offer money for particular goods or services. Money has no value in itself, but serves as a means of exchange² between commodities which do have a value to us.

People very seldom have everything they want. Usually we have to decide carefully how we spend our income. When we exercise our choice, we do so according to our personal scale of preferences. In this scale of preferences essential commodities come first (food, clothing, shelter, medical expenses etc.), then the kind of luxuries which help us to be comfortable (telephone, special furniture, insurance etc.), and finally those non-essentials which give us personal pleasure (holidays, parties, visits to theatres or concerts, chocolates etc.). They may all seem important but their true importance can be measured by deciding which we are prepared to live without. Our decisions indicate our scale of preferences and therefore our priorities.

Elasticity of demand³ is a measure of the change in the quantity of a good, in response to demand. The change in demand results from a change in price. Demand is inelastic when a good is regarded as a basic necessity⁴, but particularly elastic for non-essential commodities. Accordingly, we buy basic necessities even if the prices rise steeply, but we buy other things only when they are relatively cheap.

In economic theory, demand means the amount of a commodity or service that economic units are willing to buy, or actually buy, at a given price. In economic theory, therefore, demand is always effective demand, i.e., demand, supported by purchasing power¹, and not merely the desire for a particular commodity or service.

Obviously, demand is not only influenced by price, but also by many other factors, such as the incomes of the demanders and the prices of substitutes. In economic analysis, these other factors are frequently assumed to be constant. This allows one to relate a range of prices to the quantities demanded in what is called the demand function (with price as the independent and demand as the dependent variable) and to graph this relationship in the demand curve.

The demand curve² is the graphical representation of the demand function, i.e., of the relationship between price and demand. It tells us how many units of a particular commodity or service would be bought at various prices, assuming that all other factors (such as the incomes of the demanders and the prices of substitutes) remain unchanged. The demand curve normally slopes downwards from left to right, which means that more is bought at low prices than at higher prices. A famous exception to the rule of a downward-sloping demand curve is the Giffen paradox³. If the condition that all other factors remain unchanged is relaxed and the incomes of the demanders, for instance, are allowed to change, then the whole demand curve will shift its position.

Supply

Business people think of demand as the consumption of goods and services. At the same time, they think of supply as their production. As they see it, supply means the quantity of a product supplied at the price prevailed at the time. Economists are concerned with¹ market as a whole. They want to know how much of a certain product sellers will supply at each and every possible market price. Supply may be defined as a schedule of quantities that would be offered for sale at all of the possible prices that might prevail in the market. Everyone who offers an economic product for sale is a supplier.

The law of supply states that the quantity of an economic product offered for sale varies directly with its price. If prices are high suppliers will offer greater quantities for sale. If prices are low, they will offer smaller quantities for sale. Since productivity affects both cost and supply it is important that care can be taken² in selecting the proper materials. Productivity and cost must be kept in mind³ in order to make the best decision. It means a business must analyse the issue of costs before making its decisions. To make the decision-making process⁴ easier we try to divide cost into several different categories.

Fixed cost⁵ — the cost that a business incurs even if the plant is idle and output is zero. It makes no difference whether the business produces nothing, very little, or a lot.

Fixed costs include salaries paid to executives, interest charges on⁶ bonds, rent payments on leased properties⁷, local and state property taxes. They also take in depreciation  the gradual wear and tear on capital goods⁸ over time.

Variable cost⁹ — a cost that changes with changes in the business rate of operation or output.

Total cost¹⁰ — is the sum of the fixed and variable costs. It takes in all the costs a business faces in the course of its operations.

Marginal cost¹¹ — the extra or additional cost incurred when a business produces one additional unit of a commodity. Since fixed costs do not change, marginal cost is the increase in variable costs, which stems from using additional factors of production.

Bananas are typical example of perishable goods¹. By «perishable» we mean goods which cannot be stored for any length of time without going bad. Most foodstuffs are in the perishable category. Such goods are offered for sale as quickly as possible, and so the supply of perishables and the stock of perishables available at any time are usually the same in quantity.

This is not true in the case of non-perishable goods like coal, steel and cars, which do not deteriorate easily. The supply of cars in the market may not be the same as the actual stock of cars in the factories.

Economists talk about the Law of Supply, in which a rise in prices tends to increase supply, while a fall in prices tends to reduce it. If prices rise for a particular commodity, the rise will of course encourage producers to make more. On the other hand, if prices fall either locally or throughout the world, producers will reduce production. This can result in serious difficulties for many producers, and may cause them to go out of business completely. Overproduction² of any commodity can also create difficulties, because it can lead to a glut on the market, which may cause prices to fall sharply.

Supplies of many commodities can generally be adjusted to suit market conditions. This means that changes in prices lead to changes in the quantity of a particular commodity which is made available to consumers. Household goods³ and furniture belong to this category. In such instances supply is said to be «elastic», because it can be increased or decreased rapidly in response to market prices.

In economic theory, the term «supply» denotes the amount of a commodity or service offered for sale at a given price. Just as in the case of demand, supply is determined also by factors other than price, the most important being the cost of production and the period of time allowed to supply to adjust to a change in prices. In economic analysis, these other factors are frequently assumed to be constant. This assumption enables supply and price to be related in what is called the «supply function» (with price as the independent and supply as the dependent variable) and to be graphed in the supply curve.

The supply curve is the graphical representation of the supply function, i.e., of the relationship between price and supply. It shows us how many units of a particular commodity or service would be offered for sale at various prices, assuming that all other factors (such as the cost of production, the period of time involved) remain constant. The supply curve normally slopes upwards from left to right. This indicates that, other things being equal, more is offered for sale at higher prices.

There are, however, exceptions. For example, where goods are in fixed supply, the supply curve would be a straight vertical line. Another exception is the case where a fall in prices calls forth a larger supply because suppliers fear that prices might fall still further, and where, therefore, the supply curve actually slopes downwards. If changes in the other factors are allowed, this would be reflected not in a movement along the curve, but in a shift of the whole curve.

Market price

Prices play an important role in all economic markets. If there were no price system, it would be impossible to determine a value for any goods or services. In a market economy prices act as signals. A high price, for example, is a signal for producers to produce more and for buyers to buy less. A low price is a signal for producers to produce less and for buyers to buy more. Prices serve as a link between producers and consumers. Prices, especially in a free market system, are also neutral. That is, they favour neither the producer nor consumer.

Instead, they come about¹ as a result of competition between buyers and sellers. The price system in a market economy is surprisingly flexible. Unforseen events such as weather, strikes, natural disasters and even war can affect the prices for some items. When this happens, however, buyers and sellers react to the new level of prices and adjust their consumption and production accordingly². Before long³, the system functions smoothly again as it did before. This flexibility to absorb unexpected «shocks» is one of the strengths of a free enterprise market economy.

In economic markets, buyers and sellers have exactly the opposite hopes and intentions. The buyers come to the market larger to pay low prices. The sellers come to the market hoping for high prices. For this reason, adjustment process must take place when the two sides come together. This process almost always leads to market equilibrium⁴ — a situation where prices are relatively stable and there is neither a surplus⁵ nor a shortage⁶ in the market.

In most economic systems, the prices of the majority of goods and services do not change over short periods of time. In some systems it is of course possible for an individual to bargain over prices, because they are not fixed in advance. In general terms, however, the individual cannot change the prices of the commodities he wants. When planning his expenditure, he must therefore accept these fixed prices. He must also pay this same fixed price no matter how many units he buys. A consumer will go on buying bananas for as long as he continues to be satisfied. If he buys more, he shows that his satisfaction is still greater than his dislike of losing money. With each successive purchase, however, his satisfaction compensates less for the loss of money.

A point in time comes when the financial sacrifice is greater than the satisfaction of eating bananas. The consumer will therefore stop buying bananas at the current price. The bananas are unchanged; they are no better or worse than before. Their marginal utility to the consumer has, however, changed. If the price had been higher, he might have bought fewer bananas; if the price had been lower, he might have bought more.

It is clear from this argument that the nature of a commodity remains the same, but its utility changes. This change indicates that a special relationship exists between goods and services on the one hand, and a consumer and his money on the other hand. The consumer’s desire for a commodity tends to diminish as he buys more units of that commodity. Economists call this tendency the Law of Diminishing Marginal Utility¹.

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 rate¹ is the price for temporary use of somebody else’s money, exchange rate² 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 scarce 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 a 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 out³ of the market. In this way prices encourage producers to increase or decrease their level of output⁴. 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) organisation.

Markets and market structures

Economists classify markets according to conditions that prevail in them. They ask questions like the following: How many supplies are there? How large are they? Do they have any influence over price? How much competition is there between firms? What kind of economic product is involved? Are all firms in the market selling exactly the same product, or simply similar one? Is it easy or difficult for new firms to enter the market? The answer to these questions helps to determine market structure, or the nature and degree of competition among firms operating in the same market. For example, one market may be highly competitive because a large number of firms produce similar products. Another may be less competitive because of fewer firms, or because the products made by each are different or unique.

In short, markets can be classified according to certain structural characteristics that are shared by most firms in the market. Economists have names for these different market structures: pure competition¹, monopolistic competition², oligopoly, and monopoly.

An important category of economic markets is pure competition. This is a market situation in which there are many independent and well-informed buyers and sellers of exactly the same economic products. Each buyer and seller acts independently. They depend on forces in the market to determine price. If they are not willing to accept this price, they do not have to do business.

To monopolize means to keep something for oneself³. A person who monopolized a conversation, for example, generally is trying to stand out from⁴ everyone else and thus attract attention⁵.

A situation much like this often exists in economic markets. For example, all the conditions of pure competition may be met except that the products for sale are not exactly the same. By making its product a little different, a firm may try to attract more customers and take over the economic market⁶. When this happens, the market situation is called monopolistic competition.

The one thing that separates monopolistic competition from pure competition is product differentiation⁷. The differences among the products may be real, or imaginary. If the seller can differentiate a product, the price may be raised a little above the market price, but not too much.

The term market, as used by economists, is an extension of the ancient idea of a market as a place where people gather to buy and sell goods. In former days part of a town was kept as the market or marketplace, and people would travel many kilometres on special market-days in order to buy and sell various commodities.

Today, however, markets such as the world sugar market, the gold market¹ and the cotton market do not need to have any fixed geographical location. Such a market is simply a set of conditions permitting buyers and sellers to work together.

In a free market², competition takes place among sellers of the same commodity, and among those who wish to buy that commodity. Such competition influences the prices prevailing in the market. Prices inevitably fluctuate, and such fluctuations are also affected by current supply and demand.

Whenever people who are willing to sell a commodity contact people who are willing to buy it, a market for that commodity is created. Buyers and sellers may meet in person, or they may communicate in some other way: by telephone or through their agents. In a perfect market, communications are easy, buyers and sellers are numerous and competition is completely free. In a perfect market there can be only one price for any given commodity: the lowest price which sellers will accept and the highest which consumers will pay. There are, however, no really perfect markets, and each commodity market³ is subject to special conditions. It can be said, however, that the price ruling in a market indicates the point where supply and demand meet.

Although in a perfect market¹ competition is unrestricted and sellers are numerous, free competition² and large numbers of sellers are not always available in the real world. In some markets there may only be one seller or a very limited number of sellers. Such a situation is called a monopoly, and may arise from a variety of different causes. It is possible to distinguish in practice four kinds of monopoly.

State planning and central control of the economy often mean that a state government has the monopoly of important goods and services. Some countries have state monopolies in basic commodities like steel and transport, while other countries have monopolies in such comparatively unimportant commodities as matches. Most national authorities monopolize the postal services within their borders.

A different kind of monopoly arises when a country, through geographical and geological circumstances, has control over major natural resources or important services, as for example with Canadian nickel and the Egyptian ownership of the Suez Canal. Such monopolies can be called natural monopolies³.

They are very different from legal monopolies, where the law of a country permits certain producers, authors and inventors a full monopoly over the sale of their own products.

These three types of monopoly are distinct from the sole trading opportunities which take place because certain companies have obtained complete control over particular commodities. This action is often called «cornering the market»⁴ and is illegal in many countries. In the USA anti-trust laws operate to restrict such activities, while in Britain the Monopolies Commission examines all special arrangements and mergers⁵ which might lead to undesirable monopolies.

.The economy of Ukraine

The economy of Ukraine is an emerging free market, with a gross domestic product that fell sharply for the first 10 years of its independence from the Soviet Union and then experienced rapid growth from 2000 until 2008. Formerly a major component of the economy of the Soviet Union, the country's economy experienced a deep recession during the 1990s, including hyperinflation and a drastic fall in economic output. In 1999, at the lowest point of the economic crisis, Ukraine's per capita GDP was about half of the per capita GDP it achieved before independence. GDP growth was first registered in 2000, and continued for eight years. In 2007 the economy continued to grow and posted real GDP growth of 7%. In 2008, Ukraine's economy was ranked 45th in the world according to 2008 GDP (nominal) with the total nominal GDP of 188 billion USD, and nominal per capita GDP of 3,900 USD.

However Ukraine was greatly affected by the economic crisis of 2008 and as a result a 15.1% decrease in Ukraine's GDP took place over 2008 and 2009. Inflation slowed in July 2009 and stayed at about 8% since. The Ukrainian currency, which had been pegged at a rate of 5:1 to the U.S. dollar, was devalued to 8:1, and was stabilized at that ratio.

There was 3% unemployment at the end of 2008; over the first 9 months of 2009, unemployment averaged 9.4%. The final official unemployment rates over 2009 and 2010 where 8.8% and 8,4%. Although according to the CIA World Factbook in Ukraine there are "large number of unregistered or underemployed workers".

Taxation

There are three types of taxes in the United States: proportional, progressive and regressive.

A proportional tax is one that imposes the same percentage rate of taxation¹ on everyone, no matter what their income². Even when income goes up, the per cent of total income paid in taxes does not change.

A progressive tax is one that imposes a higher percentage rate of taxation of people with high incomes than on those with low incomes.

A regressive tax is one that imposes a higher percentage rate of taxation on low incomes than on high incomes. For example, a person with a yearly income of $10,000 may spend $3,000 on food, clothing and medicine, while a person with a yearly income of $100,000 may spend $20,000 on the same essentials. If the state sales tax, which is a regressive tax, were 4 per cent, the person with the lower income would pay a lesser amount in dollars but a higher percentage of total income.

Sales Taxes³

A sales tax is a general tax levied on consumer purchases of nearly all products. It is added to the final price paid by the consumer.

For the most part, sales taxes are collected by individual merchants at the time of the sale and are turned over weekly or monthly to the proper government agency. Most states allow merchants to keep a small portion of what they collect to compensate for their time and book-keeping costs.

The sales tax generally is a very effective means of getting revenue for states and cities.

Property Taxes⁴

A major source of revenue is the property tax — a tax on real property and tangible or intangible personal property. Real property includes land, buildings and anything else permanently attached to them. Tangible property⁵ is all tangible items of wealth not permanently attached to land or buildings, such as furniture, automobiles, the stock of goods in retail stores and clothing. Intangible personal property⁶ includes stocks, bonds, mortgages, and bank accounts.

The main problem with personal property as a source of revenue is that many items are not always brought to the attention of the tax assessor — the person who places value on property for tax purposes. Because of this, many things that should be taxed never are. Another problem is that some property is very hard to evaluate fairly.

In order to have an effective tax system, government must have criteria or standards. One such criterion is that a tax yields enough revenue.

A second criterion is clarity. Tax laws should be written so that both the taxpayer and tax-collector can understand them. This is not an easy task but people seem to be more willing to pay taxes¹, when they understand them. A third criterion is ease of administration. A tax should be easy to collect. It should not require a large enforcement staff, and it should be designed so that citizens find it hard to avoid. This criterion also includes convenience and efficiency. That is the tax should be administered at the lowest possible cost. A final criterion is fairness. Taxes should be imposed justly. However, this is hard to do because people do not always agree about what is or is not fair when it comes to taxes².

In general taxes are based chiefly on two principles: the Benefit Principle³ and the Ability-to-Pay Principle⁴.

The Benefit Principle of taxation is based on two ideas. First, those who benefit from government services should be the ones to pay for them. Second, people should pay taxes in proportion to the amount of services or benefits they receive.

The Ability-to-Pay Principle of taxation says that people should be taxed according to their ability to pay, no matter what benefits or services they receive. This principle is based on three things. First it is not possible to measure benefits, derived from government spending. Second, people with higher incomes suffer less discomfort than people with lower incomes even if they pay higher taxes. Finally, the only means most people have of paying taxes is the income they earn. Since the benefits of government services to individuals are hard to measure, the other basis for distributing taxes is income.

Business organizations

There are many types of business organizations in the business world. Choosing the form of business organization is a key factor to success of any business organization.

Anyone who wishes to start a business must take into consideration the objectives in setting up a business organization, the amount of capital needed to launch it and the level of control, the business and tax liability of different forms of ownership and expected profits or losses of the business.

There are essentially three basic ways to set up a privately owned enterprise: a sole proprietorship, a partnership, and a corporation. Each form of business organization has its advantages and disadvantages.

A sole proprietorship is an unincorporated business that is owned and operated by one person called a sole proprietor or sole trader. It's the most commonly used form for new small businesses.

Advantages of a Sole Proprietorship

• A sole proprietorship is the least costly and easiest form of business organization to launch and operate.

• A sole proprietorship is a business in which the owner is fully and personally responsible for all the obligations of the enterprise.

• A sole proprietor is entitled to all the company’s profits and takes complete managerial control.

• A sole proprietor is free to make any business decision – what kind of business activities to choose, who to hire or fire, when to take a vacation, when to liquidate his or her business and so on.

• There is preferential tax treatment. It means that any profit earned from the business is considered a sole proprietor’s income. The owner pays only personal income taxes on the business’s profits, which are reported as personal income on the proprietor’s individual income tax return.

Disadvantages of a Sole Proprietorship

• Unlimited liability being the major disadvantage of a sole proprietorship means that a sole proprietor assumes the burden of any losses or liabilities the enterprise faces. A business owner is personally responsible for the company’s debts. It means that personal assets such as money from his bank account and the proceeds from the sale of his house can be taken to pay liabilities of the business.

• Limited resources refer to the owner’s personal financial resources and his or her ability to borrow.

• A sole proprietorship ends with a sole proprietor’s death.

A partnership is an association of two or more persons, who act as co-owners of an unincorporated business and operate it for profit. The way a partnership is established, run and taxed often makes it the most attractive form of business. To start a partnership it’s necessary to draw up a partnership agreement stating the terms of the partnership, the rules of how to manage it, each partners’ personal rights and liabilities.

Advantages of a Partnership

• A partnership is relatively easy and inexpensive to establish.

• There are more possibilities in raising funds because the borrowing power of two or more partners is greater.

• Each partner can benefit a partnership by his/her knowledge, skills or ideas and specializes in certain activities of the business.

• Like a sole proprietorship partnerships are subject to special tax treatment. Any profit of a partnership passes on to its owners, who report their portion of earnings on their personal income tax returns.

Disadvantages of a Partnership:

• A partnership has unlimited liability and if it is unable to meet its financial obligations, partners have to use their personal assets to pay off all the business’s debts.

• Profit sharing can excite controversy when one or more partners aren’t putting great efforts into the management of the business.

• Disagreements between the partners may cause management conflicts. Partners’ different ideas on how to run the company can lead to disagreements that are likely to harm its business activity.

• The partnership is terminated because of the withdrawal or death of a partner. If the business is to continue, a new partnership agreement must be drawn up.

Unlike a sole proprietorship or a partnership, a corporation is a business that is authorized by law as a separate legal entity with its own powers, responsibilities, and obligations. The essential feature of a corporation is its legal independence from its owners. Ownership of a corporation is represented by shares of stock also called stock or shares. The corporate owners are known as shareholders or stockholders.

Advantages of a Corporation:

• Limited liability is one of the major advantages of a corporation. Shareholders are not liable for the debts of a company they own shares in. If a business fails shareholders can lose no more than he or she has paid for the shares of stock but their personal assets – car, home, and personal bank accounts – are safe from the creditors of the business.

• Being a separate legal entity, the corporation actually owns and operates the business for the benefit of the shareholders, but under their total control.

• Shares of ownership are transferable. Stockholders can enter or leave a corporation at will simply by buying or selling shares of stock.

• Corporation has unlimited life. The corporation’s power of succession enables it to have a continuous existence. Unlike a sole proprietorship, the death of the corporate stockholders will not terminate the corporation, since their shares are passed on to their heirs.

• It is much easier for a corporation to increase capital to manage and expand its operations. To raise additional funds corporation attracts new stockholders by selling its new issues of shares to the public.

Disadvantages of a Corporation

• A corporation is difficult and expensive to create and organize. This process requires higher start-up capital and the services of a lawyer to obtain a government charter.

• Corporation is subject to double taxation. As a legal entity it pays a corporate income tax. Then, if the corporation distributes some of its net income to the stockholders as dividends, they are taxed again on the stockholders’ individual income tax returns.

The shareholders do not directly manage the corporation's daily operations. Instead, the shareholders meet at a corporation’s annual meeting to elect a board of directors whose job is to make general business decisions. Their decisions are then implemented by the corporation's officers, who are appointed by the directors.

The economy of the United States of America

The US economy is immense. In total, the annual value of all goods and services produced in the United States, known as the gross domestic product (GDP), was estimated to be nearly $14.7 trillion in 2010, approximately a quarter of nominal global GDP. Though the 2008-2010 financial crisis has had wide-ranging and long-term consequences1 for the world and US economies, the U.S. economy maintains a very high level of output per capita. In 2010, it was estimated to have a per capita GDP of $46,844, the 7th highest in the world. The country remains the world's largest manufacturer, representing a fifth of the global manufacturing output. Over 80 percent of the goods and services purchased by US consumers each year are made in the United States, the rest is imported from other nations. The United States is home to 139 of the world's 500 largest companies, which is almost twice that of any other country. The United States has a mixed economy that has maintained a stable overall GDP growth rate, a moderate unemployment rate, and high levels of research and capital investment. It is a dynamic, free-market system that is constantly developing the choices and decisions made by millions of citizens who play multiple roles as consumers, producers, investors and voters. It is individual producers and consumers who determine the kinds of goods and services produced and the prices of those products. But though a great majority of productive resources are privately owned, the federal government does play an important part in the national economy. It provides services and goods that the market cannot provide effectively, such as national defense, public goods and services2, assistance programs for low-income families, and interstate highways and airports. The government also provides incentives to encourage the production and consumption of certain types of products, and discourage the production and consumption of others, establishes guidelines regulating environmental protection.

The United States is the largest trading nation in the world, exporting and importing more goods and services than any other country. The international trade and the policies that encourage or restrict the growth of imports and exports have a wide-ranging effect on the US economy. It increases the total level of production and consumption in the world, lowers the cost of production and prices, that consumers pay, and increases the living standard. The total value of US imports and exports has amounted to 25 percent of the country's GDP.

The US economy produces many different goods and services. We can see it more easily dividing economic activities into four sectors that produce different kinds of goods and services. The first sector provides goods that come directly from natural resources: agriculture, forestry, fishing, and mining. The second sector includes manufacturing and the generation of electricity. The third sector, made up of commerce and services, is now the largest part of the US economy. It comprises financial services, wholesaling and retailing, government services, transportation, entertainment3, tourism, and other businesses that provide a wide variety of services to individuals and businesses. The fourth major economic sector deals with recording, processing, and transmission4 of information, and includes the communication industry5.

Manufacturing and Energy Scctors. The United States leads all nations in the value of its yearly manufacturing output. Manufacturing employs about one- sixth of nation's workers and accounts for 17 percent of annual gross domestic product. Although manufacturing remains a key component of the US economy, it has decreased in relative importance. From 1957 to 1995 the number of employees in manufacturing industry declined slightly while the total labor force grew.

The leading categories of the US manufactured goods are chemicals, industrial machinejy, electronic equipment, processed foods, and transportation equipment. Transportation equipment includes passenger cars, trucks, air planes, space vehicles, ships and boats, and railroad equipment, and various kinds of construction machinery, refrigeration equipment and computers. Factories in the United States build millions of computers, and the country occupies second place in the world in the production of electronic components and exercises the world leadership in the development and production of computer software.

The manufacture of metal is concentrated in the nation’s industrial core region. Iron ore from the Lake Superior district, plus that imported from Canada and other countries and Appalachian coal are the basis for a large iron and steel industry. Different branches of industry such as textile, clothing, leather goods, food processing, precision instruments, lumber, furniture, tobacco and many other are highly developed too.

The energy to power the nation's economy1 - providing fuels for its vehicles and electricity for its machinery and appliances - is derived primarily from petroleum, natural gas, and coal. Petroleum provides 39 percent and coal - 22 percent of the total energy consumed in the USA.

Service and Commerce Sector. By far2 the largest sector of the economy in terms of output and employment is the service and commerce sector. This sector grew rapidly during the last part of the 20^th century and now it employs 75 percent of the US workforce. The growth of the sector has resulted in creating many new jobs in financing, banking, education and health services requiring advanced education. There are also low-paid positions that require less educational background3. They are store clerks, carriers, fast-food restaurant workers and others.

Transportation-related businesses are an important part of the service industry. Trucks, railroads, and ships transport goods to the markets across the country. Commercial airlines, railroads, bus companies, and taxis move tourists and commuters4 to their destinations. The US transportation network spreads into all sections of the country, but the network of railroads and highways is much denser in the eastern half of the United States, where it serves the nation's largest urban, industrial, and population concentrations. Large and small airports across the nation have formed a network providing air transportation to individual travelers. The nation has more than 5 thousand public and more than 13 thousand private airports.

One of the largest service industries in the Uni ted States is travel and tourism. In recent decades, visitors from overseas have become an increasingly important part of the US tourism business. Domestic and foreign travelers visit theme parks5, natural wonders, and points of interest in major cities. Tourism is mainstay of the economies of California, Florida and Hawaii.

The entertainment business plays a vital part in the nation's life. Motion picture production1’ has been centered in Hollywood, California, since the early decades of the 20th century. Other entertainment industries include theatre, which tends to be located in larger urban areas, particularly in New York City, (ever since the 1890s Broadway has reigned as the “Great White Way”, the major theatrical centre of the country); television, with major networks operating out of the New York City area. Atlanta is the hometown of the most famous TV-company CNN (Cable News Network). CNN is a 24-hour news

it station launched on cable television in 1980. It reaches over 75 million homes in 150 countries.

Information and Technology Sector. By the end of the 20th century many technological innovations had been introduced in the United States. One of the most far-reaching technological advances7 of the late 20th century took place in the field of computer science. The development of the personal computer allowed many individuals to own computers as well as small businesses to use computer technologies in their operations.

The Internet began in the 1960s as a small network of academic and government computers primarily involved in research for the US military. Beginning with a few researches at a handful of universities and government facilities8, the

Internet quickly became a worldwide network providing users with information on a range of subjects and allowing them to pay bills, order airline tickets, purchase goods via computer over the Internet.

The communication systems in the United States are among the most developed in the world. Television, newspapers, and other publications, provide most of the country's news and entertainment. On the average there are two radios and one television for every person in the United States. Although the economic output of the communications industry is relatively small, the industry has enormous importance to the political, social, and intellectual activity of the nation. Most communication media in the USA are privately owned and operate independently of government control.

A Natural Resource Sector. The United States, more than most countries, enjoys a wide variety1 of natural resources.

The United States has substantial mineral deposits within its borders. It leads the world in the production of phosphate, an important ingredient in fertilizers, and ranks second in gold, silver, iron ore, copper, lead, zinc, natural gas, and coal. The United States has huge fields of natural gas and oil. Petroleum production is third in the world, after Russia and Saudi Arabia. Although mining accounts for only a small share of the nation’s economic output, it was historically essential to US industrial development and remains important today. Coal and iron ore are the basis for the steel industry, which fabricates components for manufactured items such as automobiles, appliances, machinery, and other basic products. Petroleum is refined into gasoline, heating oil, and the petrochemicals used to make plastics, paint, pharmaceuticals, and synthetic fibers.

Agricultural output in the United States has historically been among the highest in the world. Despite its vast output, the US economy is so large and diversified that agriculture accounted for only 2 percent of annual GDP and employed only 3 percent of the workforce. Even though the number of farms has been declining for the last decades, overall production has increased because of more efficient operations. Bigger farms, operated as large businesses, have increasingly replaced small family farms. By applying mechanization, technology, efficient business practices2, and scientific advances in agricultural methods, larger farms produce great quantities of agricultural output using small amounts of labor and land.

The United States has some of the best cropland in the world. Cultivated farmland constitutes 19 percent of the land area of the country and makes the United States the world's richest agricultural nation. In part because of the nation's favourable climate, soil, and water conditions, farmers produce huge quantities of agricultural commodities and a variety of crops and livestock.

The United States is the largest producer of com, soybeans, and sorghum, and it ranks second in the production of wheat, oats, citrus fruits and tobacco. The United States is also a major producer of sugar cane, potatoes, peanuts, and sugar beets. It ranks fourth in the world in cattle production and second in hogs. Farmers in the United States not only produce enough food to feed the nation’s population, they also export more farm products than any other nation.

Cattle production, hog production, and chicken production are widespread throughout the United States. Vegetables are grown widely in the United States. Outside major US cities, small farms and gardens, known as truck farms3, grow vegetables and some varieties of fruits for urban markets. Most fruits grown in the United States are apples, pears, plums and citrus fruits - lemons, oranges, and grapefruits.

Forestry accounts for less than 0.5 percent of the nation's gross domestic product. Nevertheless, forests represent an essential resource for US industry. Forest resources are used in producing housing, fuel, foodstuffs, and manufactured goods.

The United States leads the world in lumber production and is second in the production of wood for pulp and paper manufacture. Since these high production levels, however, do not satisfy all of the US demand for forest products, the United States has to import lumber, most of which comes from Canada.

Rich fishing grounds of the country provide a rich marine harvest, the commercial value of which is about evenly divided4 between fish and shellfish. Americans consume approximately 80 percent of the catch as food. The remaining 20 percent goes into the manufacturing of products such as fish oil, fertilizers, and animal food.

1. The economy of Great Britain

The United Kingdom of Great Britain and Northern Ireland, a leading trading power and financial centre, has the fourth largest economy in the world, the second largest in Europe, and is a member of the European Union as well as the United Nations and North-Atlantic Treaty Organization (NATO).The United Kingdom is composed by the political union of four constituent entities¹: England, Scotland and Wales on the island of Great Britain and Northern Ireland on the island of Ireland.

Great Britain has a mixed private and public enterprise economy². In Britain’s economy private enterprises produce 75% of output and generate nearly 70% of employment³^To control and plan the economy, to avoid bankruptcy such private corporations as British Coal, British Steel, the Post Office, British Telecom, the British Airports Authorities, British Rail were nationalized after World War II. To make the British economy more efficient the government tries to stimulate innovations in industry, encourage competition, reduce taxes, promote exports, and work for world­wide free trade. The government provides financial assistance and guidance to small companies as small businesses employ more than a third of the private sector workforce. They are responsible for one-sixth of total output.

fjrade has been a key part of the British economy for centuries. Britain has only 1% of the world population but is the fifth lar­gest trading nation .^Its prosperity has been dependent upon the export of manufactured goods in exchange for raw materials and foodstuffs. Manufactured goods account for the bulk of all com­modity trade in both directions and foodstuffs and raw materials (including oil) account for around one-sixth of both imports and exports.

In fact, nowadays there is no longer any difference in the broad categories of commodities imported and exported. Great Britain’s trade focus has shifted from the United States to the European Community, which now makes up over 50% of Britain’s trade. In addition, Commonwealth nations account for 11% of Great Britain’s trade. Germany, the United States, France and the Netherlands are Britain’s main export markets. Exports, mainly to France, the United States, Germany, Italy and Ireland, are estimated at $190.1 billion and imports from the same coun­tries amount to $221.6 billion annually. The country’s chief exports are manufactured goods such as electrical and electronic equipment, aerospace equipment, machinery, chemicals, textile fibers, fuels, iron and steel, and transport equipment. The leading imports are manufactured and consumer goods, foodstuffs, industrial and electrical machinery, semi-finished goods, cloth­ing and accessories, office machines and data processing equip­ment, and transport equipment.

\ There are several main trends that have affected Britain’s economy:

the decline in the heavy industry;

the growth of the offshore oil⁴ and gas industry;

the rapid development of the electronic industry;

the increase in the service industries, as distinct from manufacturing ones;

the increase in the proportion of people in white collars⁵ as distinct from manual jobs.

According to these trends the structure of the British economy can be divided into three main sectors:")

1. Primary industries)that deal with providing raw materials and food from the land and the sea (energy resources, agriculture, forestry, fishing and water supply) — 13%.

2. Manufacturing industries^that deal with making finished goods from raw materials (electronics, aerospace, chemical, plas­tics, paper and printing industries) — 22%.

3. Service industries that deal with providing a wide variety of services (banking, insurance, computing, tourism etc) — 65%.

Primary industries. (Britain has the largest energy resources in Europe and abundant supplies of oil and natural gas& It is the world’s fifth largest oil producer. By successfully exploiting oil and gas from the North Sea Britain has become self-sufficient in energy. Coal industry is declining now but it still has considerable reserves. Half of the national consumption of energy resources is used for industrial and commercial purposes and the rest for household use.

(Great Britain is also rich in such mineral resources as iron ore, tin, limestone, salt, china clay, gypsum, and lead.)

(The British agriculture is known for its high efficiency and productivity according to European standards and based on mod­ern technology and research. The production of some foodstuffs outstrips demand. It employs only 2% of the working population, and produces nearly 2/3 of Britain’s food, needed by the country.

In Britain over three-quarters of the land is used for agricul­ture. Almost 30% of Britain’s land is arable, and almost half is meadows and pastures. About three-fifths of farms are engaged in dairy or beef cattle breeding and sheep-raising. Pig-raising is also wide spread in the country. Britain is also broadly self-sufficient in milk, poultry meat and eggs. Barley, wheat, rape, potatoes, sugar beets, fruit, and vegetables are the country’s main crops.

Britain is one of Europe’s most important fishing nations. The fishing industry provides about 65% of British fish supplies.

Manufacturing Industries. Manufacturing, one of the main sectors of the British economy deals with making finished goods from raw materials. It is a broad category of output covering pro­duction of textiles, wood and metal products, paper, plastics, rub­ber, vehicles, machinery and equipment, and a host¹ of other pro­duced goods.’ Manufacturing includes electronics, aerospace, chemical, plastics, paper and printing industries.

To start with the British manufacturing industry it is necessary to emphasize the following: while the decrease in agriculture is a long-standing trend², the fall in the share of manufacturing industry is the major economic problem. This phenomenon is com­mon to all developed countries. Though, thanks to the increasing use of intensive methods and modern technologies Great Britain remains one of the most highly industrialized countries of the world.