I. Match the terms with their definitions:

1. Goods	A. a reduction in the level of total spending resulting in lower levels of trade, profits, and prices
2. Boom	B. the raw materials, tools and machines employed in the production process
3. Deflation	C. the branch of economics concerned with aggregates, such as national income, consumption, and investment
4. Market	D. a period of high economic growth
5. Slump	E. commodities that are tangible, usually movable, and generally not consumed at the same time as they are produced
6. Macroeconomics	F. an economic condition characterized by substantial unemployment, low output and investment, etc.
7. Means of production	G. the doctrine of unrestricted freedom in commerce, especially for private interests
8. Laissez-faire	H. an institutional arrangement that fosters trade or exchange

II. Put the words in the correct order:

1. Restrictions, can, on, business, do, face, with, owners, they, capital, many, their, what.

2. Analysis, commodities, individual, with, decisions, microeconomic, deals, particular, about.

3. Science, of, extent, it, principles, a, economics, to, set, is, analytical, the, comprises, that, a.

4. Studies, every, for, theory, commodity, general, market, simultaneously, equilibrium, every.

5. All, aggregate, we, purchases, discuss, of, behavior, total, the, can, households, and, production, to, firms, and.

6. Needs, it, prosperity, the, know, everyone, explains, to, framework, economics, of, some, because.

III. Fill in the gaps with the words or word combinations in italics:

Market forces, value, depression, business activity, planning, economists, welfare, inputs, economic growth, capitalist, consumer goods, national income, macroeconomics, publicly owned, management.

1. The central problem of … in the second half of the twentieth century is the … of prosperity to maximize individual … .

2. …look forward to a future where the stockpiling of … ceases to be the major preoccupation of people’s minds.

3. In former times, the free play of … was left to decide the level of …, and the rate of … .

4. Modern economics is the study of how … is determined, and how … relate to each other in production.

5. The new economics can handle the cycles of … which caused such distress in the early years of the … system.

6. Even in countries with rigid state …, where large companies are …, those who can afford it can own a small business.

7. In the past economy tended to grow in spiral-like movements of … .

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

1. Capitalism can never exist with central planning.

2. The whole economy stands or falls by what is achieved for the individual.

3. The unique feature of economics is that it studies human behavior.

4. Economics shouldn’t be regarded as a set body of principles.

5. Macroeconomics in modern society is largely a study of government economics.

6. Controls over economic activity are likely to decrease in the future.

7. The outcome of any macroeconomic policy is always certain.

8. There is still disagreement about the nature and scope of economic inquiry.

9. Private ownership in a country and its reliance on free markets are equivalent features.

10. As a rule, microeconomists focus on one aspect of economic behavior in order to preserve the simplicity of the analysis.