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I. Match the terms with their definitions:

1. Equilibrium

A. an individual acting as a link between persons or companies

2. Aggregate supply

B. prices now current in the market

3. Aggregate demand

C. a state of balance when all the economic forces present in a situation have an equal influence and there is no tendency to change

4. Prevailing price

D. the total amount of goods and services resulting from adding together all the spending power of people in the complete economy of a country

5. Intermediary

E. the amount of an economic good that will be offered for sale in the market at a certain price or time

6. Substitute

F. the proportion of the total demand (for a product) that is supplied by a particular manufacturer

7. Market share

G. a thing that replaces or can be used in place of something

II. Answer the following questions:

1. What is a market?

2. When does a market function properly?

3. What are the key points of market definition?

4. How do markets differ in scope?

5. What benefits can be gained from international trade?

6. Why is specialization advantageous?

7. What political changes can economic cooperation lead to?

8. How can we balance market growth and development with conservation of natural resources and protection of the environment?

III. Are the following statements true or false? Correct the false ones:

1. A market is where sellers raise or fix prices and reduce output in order to increase profits.

2. A market functions properly if the quantity of goods and services demanded and supplied is equal at some given price.

3. When a market is in disequilibrium, aggregate supply equals aggregate demand at the prevailing price.

4. Markets are all similar in scope. There are only local markets, where buyers and sellers must meet and communicate directly with each other.

5. To define a market, all you need is to identify the number of companies and products available in the market.

6. Market definition takes into account supply and demand.

7. In defining a market, potential sellers are not considered.

8. Specialization brings about a rise in both output and costs.

9. According to the theory of comparative advantage, a nation should focus on the goods that it can produce more cheaply than its competitors.

10. Economic cooperation is the best way to solve political problems.

IV. Render the following sentences in English:

  • Рынок – это механизм, обеспечивающий осуществление обменных операций между продавцом и покупателем.

  • Для нормального функционирования рынка необходимо состояние равновесия, когда совокупный спрос равен совокупному предложению.

  • В определении рынка учитываются два аспекта: продукция и географическая территория, на которой она реализуется.

  • Если фирма является единственным продавцом того или иного вида продукции, она может поднять цены с целью максимизации прибыли.

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