Блинова Е.А.

Кочелаева Е.Я.

Герасимова О.А.

English for Business Usage

Ульяновск, 2012

ПРЕДИСЛОВИЕ

Данное учебное пособие предназначено для студентов факультетов, готовящих специалистов в области экономики, менеджмента и бизнеса.

Учебное пособие состоит из 7 тематических разделов (блоков). В каждый блок включены тексты профессиональной направленности, сопровождаемые лексическими упражнениями, имеющими целью проверить понимание текста и закрепить изученный материал. Диапазон заданий и упражнений достаточно разнообразен (вопросы к текстам; беседа по пройденной теме, диалоговые задания; дискуссия по предложенной проблеме; разнообразные упражнения, требующие работы со словарем; упражнения на синонимы и антонимы; задания на поиск терминологических соответствий, подстановку слов в предложения; перевод с русского на английский и с английского на русский язык).

В содержание текстов входят основные понятия и категории: принципы функционирования рыночной экономики, основы экономической деятельности, основные типы экономических систем и типы рынков; сущность, функция и история денег, понятие о налоговой системе, трудоустройство, корпоративная культура. Послетекстовые задания предназначены для развития навыков профессионально ориентированного речевого общения. Все упражнения направлены на расширение словарного запаса и на развитие речевых навыков, необходимых при коммуникативных актах в профессиональных ситуациях.

Материалы пособия заимствованы из современных аутентичных учебников английских и американских авторов.

Данное пособие может представлять интерес для преподавателей английского языка, студентов экономических специальностей, аспирантов и специалистов экономической сферы, а также всех, изучающих английский язык в группах и самостоятельно.

Unit 1

WHAT IS ECONOMICS ALL ABOUT?

Text 1. What is Economics?

What do you think of when you hear the word economics? Money? Certainly, and perhaps more complicated things like business, inflation and unemployment. Knowledge of economics will help you run a business or manage your personal finances. Very simply, economics studies the decisions people make every day. Every decision we make is a trade-off. If you spend more time working, you earn more money. However, you will have less time to relax. Economists study the trade-offs people make, the reasons for their decisions. They look at the effects these decisions have on our lives and society.

Economics is a social science that seeks to analyze and describe the production, distribution, and consumption of wealth. It is characteristic of any society that while wants of people are growing constantly, the economic resources required to satisfy these wants are limited and scarce. Scarcity of resources makes it necessary to save them. As a result any economic system is trying to find most effective and efficient ways of utilizing resources for the production of goods and services. The rational solution of the problem brings about the maximum economic growth, full employment, stable prices, equitable distribution of revenues, and social security of the needy.

There are different economic systems in the world today. Many economists argue that free enterprise, or the market economy is the most effective system, because businesses are free to choose whom to buy from and sell to and on what terms, and free to choose whom to compete with. It is done through a market, which is a set of arrangements through which buyers and sellers make contact and do business. In the market individual consumers and producers act on their own behalf.

The market functions as a rationing device with the price mechanism as its principal instrument. In free markets, prices direct allocations of inputs of firms that make the most profitable use of them. The market mechanism brings about an allocation of resources that reflect two basic factors: consumer preferences and production costs. The prices which play the coordinating role of the market mechanism are determined through the interaction of demand and supply.

All businesses produce goods and services and seek profits. They all compete with other businesses for inputs of labour, capital and natural resources.

Freedom of enterprise is not total in the market economy. Businesses are subject to laws and government regulations.

Economic machines do not always run smoothly. They are subject to a business cycle that alternates between periods of rapid expansion and periods of recession in which outputs fall and unemployment rises.

Economic environment is determined by the economic policies of the government, fiscal and monetary policies being the major factors. So, if an economic system is to perform well it must deal with many economic challenges.

Task 1. Find in the text English equivalents for the Russian phrases:

Вести бизнес; управлять личными средствами; принимать компромиссные решения; оказывать влияние на нашу жизнь и общество; производство, распределение и потребление материальных благ; ресурсы, необходимые для удовлетворения потребностей людей, ограниченны; нехватка ресурсов делает необходимой их экономию; использовать ресурсы наиболее эффективным образом; производство товаров и услуг; вызывать максимальный экономический рост; справедливое распределение доходов; социальное обеспечение нуждающихся; свободное предпринимательство – наиболее эффективная экономическая система; устанавливать контакты; действовать от своего имени; распределение ресурсов; взаимодействие спроса и предложения; подчиняться законам.

Task 2. Match the verbs from (a) with the nouns from (b) below:

1. to satisfy b) wants

to distribute factors of production

to save goods

to produce services

to utilize policy

to perform enterprise

to run allocation of inputs

to conduct functions

to choose resources

to pursue needs

Task 3. Make sentences putting the words in the correct order:

1. are, different, today, in, world, there, systems, economic, the

2. demand, if, price, exceeds, tends, rise, to, the, supply

3. wants, constantly, people, are, of, growing

4. is, competition, force, the, market, of, an, important

5. producers, must, scarce, economically, and, suppliers, utilize, resources

6. figures, dropped, according, production, to, official, oil, of

7. service, of, consists, the, transport, banking, sector, insurance, and

8. smoothly, run, always, machines, not, economic, do

9. between, rapid, business, and, periods, alternates, recession, cycle, periods, of, expansion, of

10. to, businesses, regulations, government, subject, laws, are, and

Task 4. Complete each sentence with the correct form of the word in italics. In some cases you will have to make a negative:

1. Economy

1. What sort of … system do you have in your country?

2. Strict financial controls ensure that an organization’s resources are used … .

3. Some countries have a mixed … while others have a high degree of state control.

2. engage

1. The line is … so I’ll have to try again later.

2. Cancel all my … for the rest of the day, please.

3. finance

1. Her … adviser is the project will be a success.

2. If the company is … sound we might consider taking it over.

4. grow

1. There is a …awareness of the need to improve productivity.

2. The government is worried about the … in public expenditure.

5. legal

1. It’s … to sell such goods without a proper permit.

2. They questioned the … of the company’s action.

6. possess

1. I had in my … a portion of money.

2. I am a proud …of two kiosks in Plekhanov Street.

3. A small business is one which … at least two characteristics.

7. own

1. The … is held by an individual or a small group.

2. Julie’s father … a business that deals with bulk orders.

3. The … of the bookstore was sitting at his desk.

8. distribute

1. British Leyland … their cars throughout the world.

2. His job is to organize the … of money to students.

9. know

1. We need somebody with a good working … of French.

2. Our company is well-… abroad.

10. establish

1. The … of legal minimum pay is one of the objectives.

2. There he had set out to … his own business.

Task 5. Match the words with their definitions:

1. budget A the people who control a country and make laws

2. business B information

3. convenience C company that sells goods or services

4. data D easiness

5. demand E the amount of money you have for something

6. government F how much people want something

7. inflation G the number of people without work

8. resources H something such as money, workers or minerals

belonging to an organization, country, etc which can be

used to function properly

9. trade-off I rising prices

10. unemployment J giving away something in exchange for something

Text 2. The traditional economy.

Before you read discuss questions with your partner:

• Imagine the world without money.

• How do you think society would be run?

• Would there be an economy as we understand it?

• Can you think of any examples of situations where people don’t use money, either from the past or now?

• Do you know what a traditional economy is?

It’s hard to imagine our lives without coins, banknotes and credit cards. Yet for most of human history people lived without money. For thousands of years human societies had very simple economies. There were no shops, markets or traders. There were no employers, paid workers or salaries. Today, we call this kind of economy the traditional economy, and in some parts of Asia, South America and Africa this system still exists.

People who live in a traditional economy don’t have money because they don’t need it. They live lives of subsistence. That means they hunt, gather or grow only enough food to live. There is almost no surplus in the traditional economy, and there is almost no property. Families may own simple accommodation, but land is shared by all the tribe. Economic decisions are taken according to the customs of the tribe. For example, every family may need to give some of the crops they grow to the tribal leader, but keep the rest for themselves. They don’t do this because it makes economic sense. They do it because the tribe has always done it. It’s simply a custom.

Custom, also, decides what jobs people do in the traditional economy. People generally do the jobs that their parents and grandparents did before them. Anyway, there aren’t many jobs to choose from in the traditional economy. Men are hunters, farmers or both. The woman’s place is at home looking after children, cooking and home-making. This division of labour between men and women is characteristic of the traditional economy. Whatever the work is, and whoever does it, you can be sure it’s hard work. This is because traditional economies have almost no technology. Physical strength and knowledge of the environment are the tools for survival.

Like any other economic system, the traditional economy has its benefits and drawbacks. Probably the biggest benefit is that these are peaceful societies. People consume almost everything they produce and own practically nothing. They are equally poor. For all these reasons, war is almost unknown in these societies.

However, people who live in traditional societies are among the poorest people in the world. Because custom decides what people do, nothing in these societies ever changes. Because there is no technology, people depend on nature to survive. They have no protection from environmental disasters like droughts and floods. They are always in danger of hunger and disease.

But the traditional economy is in danger itself. There only a few examples left on the planet. In 100 years from now, it may have disappeared forever.

Task 1. Read the text again and match each paragraph with the correct heading:

PARAGRAPH 1 ------------------------------

PARAGRAPH 2--------------------------------

PARAGRAPH 3-------------------------------

PARAGRAPH 4-------------------------------

PARAGRAPH 5-------------------------------

PARAGRAPH 6—---------------------------

A Life without money

B The advantages of the traditional economy

C The future of the traditional economy

D The disadvantages of the traditional economy

E The importance of tradition

F Work in the traditional economy

Task 2. Discuss these questions with your partner.

• What kind of people do you think still live in a traditional economy today?

• Where do they live?

• What are their lives like?

Task 3. Chose the correct answer A, B, or C from the list below:

1. Although we can buy meat in the shops, some people still like to_________ animals as a hobby.

2. _________ is another word for extra things that are not needed.

3. There are still _________ of people living traditional lives in the rainforests of South America.

4. In most modern societies, _________ like celebrations and dances have disappeared.

5. Corn and wheat are two _________ that farmers grow in their fields.

6. One of the _________ of playing sports is that you keep fit.

7. One of the _________ of living in a city is the noise.

8. Many African countries suffer from regular _________ when no rain falls for months.

9. Heavy rain causes _________ in many parts of Europe each year.

10. East Asian countries are well known for their __________ industries such as computers and cameras.

11. Exercises and sports at school are sometimes called _________ education.

1. A chase B hunt C eat

2. A surplus B goods C shortage

3. A customs B tribes C pygmies

4. A parties B patterns C customs

5. A crops B animals C foods

6. A goods B disadvantages C benefits

7. A drawbacks B benefits C customs

8. A floods B droughts C hurricanes

9. A floods B droughts C hurricanes

10. A agricultural B heavy C technology

11. A physical B mental C fun

Text 3. The market economy.

Before you read discuss these questions with your partner:

• Do you think most countries have a market which is free from government management?

• Can you think of any examples supporting or disagreeing with this idea?

Have you ever walked through a busy street market? People push their way through crowds of others in order to reach the stalls first. The air is full of deafening shouts. Stall owners yell to advertise their goods. Buyers cry out their orders. It’s hard to imagine, but behind this noisy confusion is a very logical economic theory: the market economy.

The market economy is sometimes called the free market. A free market is not controlled in any way by a government. It is also free from the influence of custom or tradition. In a free market, the only reason why things are bought and sold is because there is a demand for them. Prices for goods and services are simply what people prepared to pay. The market economy is not really controlled by anyone. It controls itself.

The street market where we began has many of the characteristics of the free market. Customers arrive at the market with a shopping list of things they need. They also come with an idea of how much they are prepared to pay. Stall owners sell what customers demand, and try to get the highest price they can for it. Supply and demand control what is on the market and how much it sells for. In the wider economy, we are all customers, and the stall owners are like companies.

The role of the company in the free market is to supply what people want. However, companies need an incentive. The incentive is profit. There two ways for companies to make a profit. The first way is to raise their prices. The second way is to reduce their production costs. And this brings us two more features of the market economy: competition and technology.

Competition exists in a free market because, theoretically, anyone can be a producer. This means that companies have to compete with each other for a share of the market. Competition is good for consumers because it helps to control prices and quality. If customers aren’t happy with a product of service, or if they can’t afford it, they will go to a competitor.

Technology exists in a free market because producers need ways to reduce their costs. They cannot buy cheaper raw materials. Instead, they must make better use of time and labour. Technology is the use of tools and machines to do jobs in a better way. This helps companies produce more goods in less time and with less effort. The result: more profit.

People often think that most economies are free markets. However, at the macroeconomic level, a truly free market economy does not exist anywhere in the world. This is because all governments set limits in order to control the economy. Some governments set many limits, other governments set very few, but they all set some. For this reason, a true market economy is only theoretical. Nevertheless, many of the features of the market economy do exist in most societies today.

Task 1 . Read the text again and answer these questions:

1. Who controls a market economy?

2. Who decides what products are for sale in a free market?

3. What do companies want?

4. Why is competition a good thing?

5. Why does technology exist in the market economy?

6. Why are there no true market economies in the world today?

Task 2. Complete each sentence with a word or phrase from the box:

advertise afford competition controlled costs incentive limit

prepared profit raise reduce role street market theoretical

1. Every Saturday this road becomes the local _________ where people come to buy fruit and vegetables.

2. Business _________ their products in the media to attract more customers.

3. My _________ in the business is to meet customers and find out what they want.

4. Making money is the main _________ to work.

5. I thought this old camera for €650 and sold it for €75. That’s €25_________.

6. If there’s only one producer in the market, there is no _________.

7. Production _________are the amount of money companies spend to make a product.

8. The idea that life exists on other planets is _________ . Nobody knows for sure.

9. A _________ economy is one where a government decides what can be bought and sold and/or how it is done.

10. The speed _________on this road is 90 kilometers per hour.

11. When there is a demand we _________ prices but we _________ them if we want to sell something quickly.

12. I can’t_________ that car – it’s far too expensive.

13. People are _________ to pay a lot for services if they are of a good quality.

Text 4. The planned economy

In many ways, the planned economy is the direct opposite of the market economy. In the market economy, the forces of supply and demand decide everything: what is produced, how much is produced, the methods of production and the price. In the planned economy, all of this is decided by the government. In every way that the market economy is free, the planned economy is controlled.

Unfortunately, no economic system is perfect. If there was a perfect system, economists wouldn’t have anything to argue about! Market economies have their strength, but they have their problems, too. Planned economies try to provide solutions to these problems. For example, the free market supplies the things that people want. However, what people want and what they need are not always the same: Fast food is always in demand, but it’s bad for us. In a planned economy, the government could decide to stop fast food restaurants operating in the market.

A second problem with free markets is that producers always want the highest price. Often the poor can’t afford things. In a planned economy, the government sets prices. They make sure that everyone can afford basic commodities. This is one way that planned economies try to share things equally. Another is to control how much people get paid.

In a planned economy, workers’ wages depend on the service they provide to society. If people can live without their service, you get paid less. This is very different from the free market. In the free market, someone’s salary mostly depends on the demand for his or her work. If people like what you do, you get paid more.

Before 1900, there were few examples of planned economies. During the 20th century, however, the planned economy became the standard for socialist governments like the USSR and China. These countries experienced amazing economic growth in a very short time. In a market economy, it takes a long time for big industries to grow from small companies. In a planned economy, however, huge industries can grow overnight. The government simply decides to spend money on factories and factories appear. Britain, for example, took centuries to develop her steel industry in a free market economy. China developed hers in a few decades.

But, as we said, no economic system is perfect. The planned economy has many drawbacks. One of these drawbacks is problems with supply. It is difficult for governments of planned economies to know exactly how much to produce to meet demand. In a market economy, when the price of a commodity rises, this indicates a rise in demand. Companies then supply more to the market. This warning system doesn’t work in a planned economy because price is controlled by the government. The result is shortages.

When shortages happen, governments can do two things: ration goods or raise prices. In this situation, people then start to hoard things, and the problem gets even worse. As the population gets bigger, shortages like this become more common. For this reason, China – once the world’s biggest planned economy – is rapidly moving towards another system: the mixed economy.

Task 1. Now read the text again and decide whether these statements are true or false:

1. In a planned economy, the government decides how products are made.

2. In a planned economy, suppliers can sell anything that is in demand.

3. In a planned economy, a doctor should get paid more than a footballer.

4. Planned economies grow more slowly than market economies.

5. In a market economy, greater demand for something makes it cheaper.

6. Planned economies are difficult to run in countries with large populations.

Task 2. Match the words and phrases with the definitions:

1 commodity A when the government sets a limit on how much people

can buy of something

2 standard B when there is not enough of something

3 socialist C a strongly metal made from iron

4 industry D something you can buy or sell

5 steel E what is usual or typical

6 indicate F all the businesses and companies involved in

the production of something

7 warning system G describes someone/something aiming to share

wealth equally

8 shortage H secretly storing and hiding goods for use later

9 rapidly I work

10 ration J show

11 solution K very quickly

12 hoard L money paid regularly for work done

13 operate M answer to a problem

14 wages N a system which tells us that something bad is going to happen

Text 5. The mixed Economy

Most economists would say that there are no examples in the world today of a completely free market or a completely controlled economy. Instead, every country operates a mixture of the two systems. Even in the freest economies, like the USA, there is some government control; even in the strictest planned economy there is some free enterprise.

Economies mix government control and free market values in different ways. One way is to let privately owned business exist alongside state run industries. The economy becomes divided between the state sector and the private sector. The state sector often includes industries that the government thinks are important and need protection from the risks of the free market. These could include public transport, hospitals, schools and the postal service. The state sector can also include large industries that are important for a country’s economic health, such as oil, steel or agriculture. These are sometimes called primary industries because they provide basic materials to manufacturers.

These state sector industries use money that the government collects in taxes. Often, they do not need to compete with other companies because no other company is allowed to provide the same product or service. However, many countries have recently started a process called deregulation.

Deregulation means freeing up the economy to allow private businesses to compete with state-run industries. The state sector should then run more efficiently in order to compete in the free market and because it now has less government protection.

Deregulation of services like telecommunications, transport and banking has happened in many countries in recent years. People have generally accepted these changes. However, generally the public is less happy when governments start talking about deregulation in education and health services. Many people feel that profit motivation will harm these services rather than improve them.

Another way in which economies today are mixed is that governments put limits on free enterprise. For example, governments may decide to ban trade in certain goods if they are dangerous. They may also create laws to make sure companies trade honestly or to prevent monopolies. If a company has a monopoly, normal market forces do not effect it. This is bad for consumers and the economy in general. Governments may also regulate methods of production. They do this to guarantee that products are safe for consumers and to protect the environment.

Many economists would argue that the mixed economy is the best system for consumers. This is because consumers have two ways to control the economy: by choosing to buy a company’s goods or services and by choosing to give political parties their votes.

Task 1. Now read the text again and answer the questions:

1. What do most economists believe about economies in the world today?

A There are a number of free markets

B Some countries have a completely planned economy

C A mixed economy exists in some way in all countries.

2. Why do governments choose to run some industries?

A So they can collect taxes.

B They need to be protected from the risks of the free market

C To encourage a divided economy

3. Why do governments deregulate some industries?

A To make the industries more efficient.

B To protect them

C There is too much competition.

4. According to the text, what is not very popular with the public?

A Deregulation of public transport.

B Deregulation of hospitals and schools

C Deregulation of telecommunications and banking.

5. What type of state control is not mentioned in paragraph 6?

A Controlling the way companies do business.

B Controlling what companies sell.

C Controlling the prices companies set.

Task 2. Complete each sentence with a word or phrase from the box:

agriculture ban efficiently free enterprise manufacturers monopoly private sector

profit motivation public transport state sector telecommunications

1. _________ is when businesses are able to trade without control from the government.

2. _________ industries belong to and are run by the government.

3. _________ industries belong to and are run by independent businesses.

4. Buses, trains and planes are examples of _________ .

5. _________ is another word for farming.

6. _________ produce new goods from raw materials.

7. When a business works _________ , it runs successfully without wasting resources.

8. Telephone and Internet systems are part of the _________ industry.

9. _________ is what drives businesses in the market economy.

10. When the government puts a _________ on a commodity, people are not allowed to buy or own it.

11. If only one company controls part of the economy, they have a_________.

12. When companies_________, they do business with each other.

Task 3. Write an essay about one of the famous thinkers (A. Smith, Stolypin, Kondratyev or some other).

Unit 2.

MANAGEMENT

Text 1. What is management?

Peter Drucker the well-known American business professor and consultant, suggests that the work of a manager can be divided into planning (setting objectives), organizing, integrating (motivating and communicating), measuring and developing people.

First of all, managers set objectives and decide how their organization can achieve them. This involves developing strategies, plans, and precise tactics, allocating resources of people and money.

Secondly, managers organize. They analyse and classify the activities of the organization and the relations among them. They divide the work into manageable activities and then into individual jobs. They select people to manage these units and perform the jobs.

Thirdly, managers practise the social skills of motivation and communication. They also have to communicate objectives to the people responsible for attaining them. They have to make the people who are responsible for performing individual jobs form team. They make decisions about pay and promotion. As well as organizing and supervising the work of their subordinates, they have to work with people in other areas and functions.

Fourthly, managers have to measure the performance of their staff, to see whether the objectives set for the organization as a whole and for each individual member of it are being achieved.

Fourthly, managers have to measure the performance of their staff, to see whether the objectives set for organization as a whole and for each individual member of it are being achieved.

Lastly, managers develop people – both their subordinates and themselves.

Obviously, objectives occasionally have to be modified or changed. It is generally the job of a company's top managers to consider the needs of the future, and to take responsibility for innovation, without which any organization can only expect a limited life. Top managers also have to manage a business's relations with customers, suppliers, distributors, bankers, investors, neighbouring communities, public authorities, and so on, as well as deal with any major crises which arise. Top managers are appointed and supervised and advised (and dismissed) by a company's board of directors.

 Although the tasks of a manager can be analyzed and classified in this fashion, management is not entirely scientific. It is human skill. Business professors obviously believe that intuition and 'instinct' are not enough; there are management skills that have to be learnt. Drucker, for example, wrote over 20 years ago that ' Altogether this entire book is based on the proposition that the days of the "intuitive" manager are numbered', meaning that they were coming to an end. But some people are clearly good at management, and others are not. Some people will be unable to put management techniques into practice. Others will have lots of technique, but few good ideas. Outstanding managers are rather rare.

Task 1. Complete the following sentences with these words:

achieved           board of directors       communicate    innovations     

 manageable      performance resources        setting              supervise

1. Managers have to decide how best to allocate the human, physical and capital_________ available to them.

2. Managers - logically - have to make sure that the jobs and tasks given to their subordinates are _________.

3. There is no point in _________ objectives if you don't _________ them to your staff.

4. Managers have to _________ their subordinates, and to measure, and try to improve, their_________ .

5. Managers have to check whether objectives and targets are being_________.

6. A top manager whose performance is unsatisfactory can be dismissed by the company's_________.

7. Top managers are responsible for the_________ that will allow a company to adapt to a changing world.

Task 2. Match up these verbs and nouns to make common collocations:

allocate decisions

communicate information

develop jobs

make objectives

measure people

motivate performance

perform resources

set strategies

supervise subordinates

Text 2. How to be a great manager?

Task 1. Read the text and decide which of the following comments you would expect the writer to agree with. Use the text to support your answers:

Successful managers …

1. are happy when their staff make progress in the company.

2. try to be positive even when times are difficult.

3. tell head office if any of their staff make mistakes.

4. praise their staff as often as they can.

5. encourage employees to speak out if they are unhappy.

6. make sure they know what’s going on outside their company.

7. keep in touch with their staff and customers.

8. never dislike any member of their staff.

9. concentrate on their employees’ strong points and try to correct their weak ones.

10. ignore people’s weal points, pretending they don’t exist.

11. enjoy new challenges.

12. don’t find it easy to delegate responsibility.

How to Be a Great Manager

At the most general level, successful managers tend to have four characteristics:

They take enormous pleasure and pride in the growth of their people;

They are basically cheerful optimists – someone has to keep up morale when setbacks occur;

They don’t promise more then they can deliver;

When they move on from a job, they always leave the situation a little better than it was when they arrived.

The following is a list of some essential tasks at which a manager must excel to be truly effective.

Great managers accept blame: When the big wheel from head office visits and expresses displeasure, the great manager immediately accepts full responsibility. In everyday working life, the best managers are constantly aware that they selected and should have developed their people. Errors made by team members are in very real sense their responsibility.

Great managers give praise: Praise is probably the most under-used management tool. Great managers are forever trying to catch their people doing something right, and congratulating them on it. And when praise comes from outside, they make it clear who has earned it. Managers who regularly give praise are in a much stronger position to criticize or reprimand poor performance. If you simply comment when you are dissatisfied with performance, it is all too common for your words to be taken as a straightforward expression of personal dislike.

Great managers make blue sky: Very few people are comfortable with the idea that they will be doing exactly what they are doing today in 10 years’ time. Great managers anticipate people’s dissatisfaction.

Great managers put themselves about: Most managers now accept the need to find out not merely what their team is thinking , but what the rest of the world, including their customers, is saying.

Great managers judge on merit: It’s virtually impossible to divorce your feelings about someone - whether you like or dislike them – from how you view their actions. But suspicions of discrimination or favouritism are fatal to the smooth running of any team, so the great manager accepts this as an aspect of the game that really needs to be worked on.

Great managers exploit strengths, not weaknesses, in themselves and in their people: Weak mangers feel threatened by other people’s strengths. Great managers have no truck with this destructive thinking. They see strengths, in themselves as well as in other people, as things to be built on, and weaknesses as something to be accommodated, worked around and, if possible, eliminated.

Great managers make things happen: The old-fashioned approach to management was rather like the old-fashioned approach to child-rearing: “Go and see what the children are doing and tell them to stop it”. Great managers have confidence that their people will be working in their interests and do everything they can to create an environment in which people feel free to express themselves.

Great managers make themselves redundant: What great managers do is learn new skills and acquire new information from the outside world and then immediately pass them on. Great managers are perpetually on the look-out for high-level activities to occupy their own time, while constantly passing on tasks that they have already mastered.

Task 2. Write a brief profile of yourself, outlining your personal qualities and highlighting any strengths and weaknesses you feel you have. Then write a brief profile of your partner. Use the list of personal qualities to help you. Then compare the profiles and discuss any differences between them with your partner:

Strengths Weaknesses

confident caring arrogant nosy

enterprising prudent opportunistic indecisive

humorous focused frivolous tunnel-visioned

ambitious punctual ruthless interfering

helpful supportive controlling irresponsible

forceful generous boastful unreliable

competitive initiative wishy-washy tough

open to change accurate obsessive shallow

thorough tolerant uncaring selfish

Task 3. The following pair of words are frequently confused. Choose the correct word to complete each sentence:

ensure; assure

dissatisfied; unsatisfied

effective; efficient

morale; moral

criticism; critic

1. A good manager will _________that his staff have an opportunity to express their opinions.

2. In my opinion, the demand for this product is still largely_________.

3. The new machine is very _________ – it is quick, clean and very economical to run.

4. The_________ of the story is that if you must dismiss someone, you had better do it quickly.

5. Our new advertisements have come in for a lot of_________ – many people consider they are in poor taste.

6. I was _________ with the service I received at the restaurant.

7. I _________ you that everything will be all right.

8. A _________is a person who judges, evaluates, or analyzes literary or artistic works, dramatic or musical performances, or the like, especially for a newspaper or magazine.

9. There are many barriers to _________ teamwork.

10. The _________ of the staff depends largely on the values of the company.

Text 3. Pan-European Teamwork

Task 1. Read the text and give Russian equivalents for the English words in bold:

Slowly they entered the room in ones and twos, anxiously looking for familiar faces. Some took refuge in intense conversation to avoid the searching eyes of strangers. Others were preoccupied rearranging papers.

The Scandinavians were the first to arrive, conspicuous in their plaid jackets and open-necked shirts. Exactly on the stroke of nine o’clock the Germans entered, debating with their Austrian colleagues. The US participants followed, introducing themselves to everyone they passed.

Then two hesitant figures in dark, their formal handshakes unmistakably betraying them as the British representatives. The seats around the circle of tables were almost filled and the buzz of polite conversation began falling off when the Italian participants , dressed in fine tailored suits, were the last to arrive.

The group of managing and marketing directors from nine national subsidiaries of a large international company had gathered in a European capital city for a three-day meeting with a dual purpose.

Their primary task was to draw up a pan-European marketing strategy to exploit the EC’s single market. The meeting was also seen as an opportunity for the executives to learn about working within a multicultural team.

As with many multicultural groups, the first difficulties emerged over the language. The meeting was conducted in English, but not all the participants were equally fluent or confident about expressing themselves. Not surprisingly, native English speakers dominated the early discussions. Impatient with the time it took others to formulate their views, British and US participants frequently interrupted the long periods of silent contemplation with even more suggestions of their own. To construct coherent arguments in a non-native language takes time and requires concentration.

The use of only one language was the most obvious barrier to multicultural teamworking. As the first working session progressed, however, the comments made and ideas proposed revealed how unconscious cultural bias and corporate myths dominated the participants’ thinking.

French executives argued for their proposal, since it was manifestly the most logical. No, said the Germans, their approach should be endorsed because it was technically superior and had a proven track record. No one gave serious consideration to the Danish approach. The ideas produced by the Italians were seen as elegant but impractical.

The members of this multicultural team, brought together for the first time, reacted like all human beings: in the absence of more reliable information, they made liberal use of preconceived stereotypes about the nations they did not know. Or where they had some experience, they generalized by using one past incident to predict the behavior of that nationality. This multicultural team was obviously taking refuge in simplistic stereotypes and over-generalisations.

To address this obstacle to effective teamworking, time was taken to learn about the characteristic behavior of the nations present. Each national group had to act as informants on their own culture, and each group heard how their cultural behavior influenced the perceptions and attitudes of others.

This activity produced much laughter. The linear, time-conscious Northern Europeans discovered the mysteries of their Latin colleagues’ flexible approach to time and capacity to deal with several projects simultaneously. The Anglo-Saxons learned about alternatives to adversarial relationships in industry from the consensus-orientated Scandinavian managers. Each group explored the emphasis it placed upon personal relationships in getting things done, cultural preferences for long-term outcomes and the importance attached to being liked, a theme that proved sensitive to many of the executives.

Many significant messages and difficult observations were delivered in jest and mimicry throughout the remainder of the meeting. But all the participants acknowledged the pain of learning, and the importance of more accurate perceptions in putting together a draft marketing strategy.

Yes, they agreed, it might need more work, but their future efforts would be less likely to be side-tracked by superficial differences of culture.

Task 2. Answer the questions:

1. Why did representatives of the multicultural team gather for a three-day meeting? What countries were present at the meeting?

2. What barriers to effective teamwork were evident?

3. What conclusions did the participants come to?

4. What factors do you think contribute to effective work in a multinational team?

Task 3. Write an essay on one of the issues:

1. A good manager – how to meet the requirements.

2. Multicultural working – barriers and prospects.

Text 4. The Management Process

 

Managers at every level plan, organize, lead, and control. But they differ in the amount of time devoted to each of these activities. Some of these differences depend on the kind of organization in which the manager works, some on the type of job the manager holds.

Managers of small private clinics, for example, spend their time quite differently from the way the heads of large research hospitals spend theirs: Managers of clinics spend comparatively more time practicing medicine, and less time actually managing, than do directors of large hospitals. The technical supervisor of research physicists at AT&T Bell Labs will have a job that in some respects is quite different from that of a production supervisor on a General Motors assembly line. Yet both are first-line managers. And yet there will also be important similarities in the jobs of all these managers.

Other differences in the ways managers spend their time depend upon their levels in the organizational hierarchy. Robert L. Kats, a teacher and business executive, has identified three basic kinds of skills: technical, human, and conceptual. Every manager needs all three. Technical skill is the ability to use the procedures, techniques, and knowledge of a specialized field. Surgeons, engineers, musicians, and accountants all have technical skills in their respective fields. Human skill is the ability to work with, understand, and motivate other people, as individuals or in groups. Conceptual skill is the ability to coordinate and integrate all of an organization’s interests and activities. It involves the manager’s ability to see the organization as a whole, to understand how its parts depend on one another, and to anticipate how a change in any of its parts will affect the whole.

Kats suggests that although all three of these skills are essential to a manager, their relative importance depends mainly on the manager’s rank in the organization. Technical skill is most important in the lower levels. Human skill, by contrast, is important for managers at every level: because they must get their work done primarily through others, their ability to tap the technical skills of their subordinates is more important than their own technical skills. Finally, the importance of conceptual skill increases as one rises through the ranks of a management system based on hierarchical principles of authority and responsibility. It depends mainly on the manager’s rank in the organization.

Task 1. Match the jobs and departments with their Russian equivalents:

1. Board of Directors 1. Отдел маркетинга

2. Chairman 2. Директор-распорядитель

3. Managing Director 3.Коммерческий директор

4. PRO (Public Relations Officer) 4. Главный управляющий по информации

5. Chief Accountant 5. Отдел информационных систем

6. Sales Manager 6.Бухгалтерия

7. CEO (Chief Executive Officer) 7.Плановый отдел

8. Sales Department (Dpt.) 8. Главный администратор

9. Finance Dpt. 9.Председатель

10. CIO (Chief Information Officer) 10.Начальник транспортного отдела

11. Accounts (Accounting) Dpt. 11.Сотрудник отдела по связям с общественностью

12. Advertising Dpt. 12.Главный бухгалтер

13. Training Dpt. 13. Руководитель проекта

14. Planning Dpt. 14.Отдел сбыта

15. Marketing Dpt. 15. Управляющий отделом продаж

16.R&D (Research & Development)Dpt. 16. Отдел рекламы

17. Administration Dpt. 17. Отдел исследований

18. Distribution Dpt. 18.Отдел подготовки кадров

19. Packaging Dpt. 19. Отдел снабжения

20. Production Dpt. 20. Финансовый отдел

21. Purchasing Dpt. 21. Заместитель управляющего

22. Personal Dpt. 22.Производственный отдел

23. MIS (Management Information System) 23. Отдел кадров

24. Project Manager 24. Отдел упаковки товара

25. Business Manager 25. Отдел распространения продукции

26. Deputy Manager 26. Отдел административного управления

27. Traffic Manager 27. Совет директоров

Text 5. Management and cultural diversity

Managing a truly global multinational company would obviously be much simpler if it required only one set of corporate objectives, goals, policies, practices, products and services. But local differences often make this impossible. A fairly obvious cultural divide that has been much studied is the one between, on the one hand, the countries of North America and north-west Europe, where management is largely based on analysis, rationality, logic and systems, and, on the other, the Latin cultures of southern Europe and South America, where personal relations, intuition, emotion and sensitivity are of much greater importance.

The largely Protestant cultures on both sides of the North Atlantic (Canada, the USA, Britain, the Netherlands, Germany, Scandinavia) are essentially individualists in such cultures, status has to be achieved. You don't automatically respect people just because they've been in a company for 30 years. A young, dynamic, aggressive manager with an MBA (a Master in Business Administration degree) can quickly rise in the hierarchy.

In most Latin and Asian cultures, on the contrary, status is automatically accorded to the boss, who is more likely to be in his fifties or sixties than in his thirties. This is particularly true in Japan, where companies traditionally have a policy of promotion by seniority. A 50-year-old Japanese manager, or a Greek or Italian or Chilean one, would quite simply be offended by having to negotiate with an aggressive, well-educated, but inexperienced American or German 20 years his junior. A Japanese would also want to take the time to get to know the person with whom he was negotiating, and would not appreciate an assertive American who wanted to sign a deal immediately and take the next plane home.

In northern cultures, the principle of pay-for-performance often successfully motivates sales people. The more you sell - the more you get paid. But the principle might well be resisted in more collectivist cultures, and in countries where rewards and promotion are expected to come with age and experience. Moreover, Singaporean and Indonesian managers objected that pay-for-performance caused salesmen to pressure customers into buying products they didn't really need, which was not only bad for long-term business relations, but also quite simply unfair and ethically wrong.

Another example of an American idea that doesn't work well in Latin countries is matrix management. The task-oriented logic of matrix management conflicts with the principle of loyalty to the all-important line superior, the functional boss. You can't have two bosses any more than you can have two fathers. Andre Laurent, a French researcher, has said that in his experience, French managers would rather see an organization die than tolerate a system in which a few subordinates have to report to two bosses.

In discussing people's relationships with their boss and their colleagues and friends, I am convinced we can also distinguishes between, universalists and particularists. The first believe that rules are extremely important; the second believe that personal relationships and friendships should take precedence. Consequently, each group thinks that the other is corrupt. Universalists say that particularists cannot be trusted because they will always help their friends, while the second group says of the first 'you cannot trust them; they would not even help a friend'.

Task 1.Find words in the text which mean the following.

1. the use of reasoning rather than emotions or beliefs

2. understanding or knowing without consciously using reason

3. respect, prestige or importance given to someone

4. having a higher rank because one is older

5. to have hurt feelings because someone is being disrespectful

6. money or something else given in recognition of good work

7. additional money given for better work or increased productivity

8. a feeling of shame and loss of dignity or self-esteem

9. to give up a job or position

10. according to accepted moral standards

Unit 3

MARKETING

Text 1. What is marketing?

What is marketing? Marketing is the creative process of satisfying customer needs first. The information you are interested in is if there is any demand for your goods, what the market potential is, what sort of competition you will meet, i.e. how the price of your goods compares with other competitive products including those produced locally, local conditions and preferences, local trading customs and habits, what seasonal factors should be taken into account and the like.

But in general marketing covers not only market research, but also planning, the selection (assortment) of goods, and consequently the production itself, price policy, advertising and promotion of sales, controlling the sales and post-sales servicing.

So marketing is a system of running all the business activities of a company (organization) with respect to coordinating supply and demand for the goods produced. Originally marketing was meant to help avoid over-production in advanced countries.

Marketing within the framework of our economy may also be the coordination of the production and circulation of goods for the purpose of using all the resources for the benefit of people and for covering in the best possible way all their needs (requirements).

Advertising is an important means of promoting the goods that are already being produced as well as new lines of business. There specialized firms dealing with advertising.

Different kinds of mass media – TV, radio, newspapers, cinema, journals, magazines, posters, - are used for advertising goods. Special leaflets, booklets and other printed matter about goods may be published for the same purpose. Participation in fairs and exhibitions helps promote our goods as well. Also, special advertising conferences may be held. The choice of media for advertising depends on the kind of goods and on the local conditions and people’s habits: sometimes TV and radio are the best, in other cases it may be trade journals or leaflets distributed among potential buyers.

Task 1. Answer the questions:

1. What information about marketing are you interested in?

2. What was the original purpose of marketing?

3. What does marketing cover?

4. Is advertising important in marketing? Why?

5. What means of advertising are used in marketing?

Task 2. Find the following phrases in the text and translate them in the Russian:

Other competitive products; to deal with; advertising and promotion of sales; to take into account; advertising goods; printed matter; to satisfy customer needs; the market potential; to meet demand; market research; mass media; supply and demand for goods.

Task 3. Continue the phrases:

1. Marketing is a creative process… .

2. Marketing is a system of … .

3. Marketing is the coordination … .

Task 4. Find in the text the following English word combinations:

Исследование рынка; пользоваться большим спросом; развитые страны; средства массовой информации; информация, в которой вы заинтересованы; избегать перепроизводства товаров; местные обычаи и привычки; товары, конкурирующие с вашими; ценовая политика; на благо людей; реклама – важное средство продвижения товаров; рекламные агентства; специальные буклеты, брошюры и другие печатные материалы; участие в ярмарках и выставках: выбор зависит от.

Text 2 The centrality of marketing

Most management and marketing writers now distinguish between selling and marketing. The 'selling concept' assumes that resisting consumers have to be persuaded by vigorous hard-selling techniques to buy non-essential goods or services. Products are sold rather than bought. The 'marketing concept', on the contrary, assumes that the producer's task is to find wants and fill them. In other words, you don't sell what you make you make what will be bought. As well as satisfying existing needs, marketers can also anticipate and create new ones. The markets for the Walkman, video games, personal computers, and genetic engineering, to choose some recent examples, where largely created rather than identified. 

Markets are consequently always looking for market opportunities - profitable company is likely to enjoy a differential advantage, due to its distinctive competencies (the things is does particularly well). Market opportunities are generally isolated by market segmentation. Once a target market has been identified, a company has to decide what goods or services to offer. This means that much of the work of marketing has been done before the final product or service comes into existence. It also means that that the marketing concept has to be understood throughout the company, e.g. in the production department of a manufacturing of company as much as in the marketing department itself. The company must also take account of the existence of competitors, who always have to be identified, monitored and defeated in the search for loyal customers.

Rather than risk launching a product or service solely on the basis of intuition or guesswork, most companies undertake market research (GB) or marketing research (US). They collect and analyze information about the size of a potential market, about consumers' relations to particular product or service features, and so on. Sales representatives, who also talk to consumers, and other important source of information

Once the basic offer, e.g. a product concept, has been established, the company has to think about marketing mix, i.e. all the various elements of a marketing programm, they integration, and the amount of effort that a company can expand on them in order to influence the target market. The best-known classification of these elements is the '4 Ps': product, place, promotion and price. Aspects to be considered in marketing products include quality, features (standard and optional), style, brand name, size, packaging, services guarantee. Place in a marketing mix includes such factors as distribution channels, location of points of sale, transport, inventory size, etc. Promotion groups together advertising, publicity, sales promotion, an personal selling, while price includes the basic list price, discounts, the length of payment period, possible credit terms, and so on. It is the job of a product manager or a brand manager to look for ways to increase sales by changing the marketing mix. 

It must remembered that quite apart from consumer markets (in which people buy products for direct consumption) there exist an enormous producer or industrial or business market, consisting of all the individuals and organizations that acquire goods and services that are used in production of other goods, or in the supply of services to others. Few consumers realize that the producer market is actually larger than the consumer market, since it contains all the row materials, manufactured parts ad components that go into consumer goods, plus capital equipment such as buildings and machines, supplies as energy and pens and paper, and service ranging from cleaning to management consulting, all of which have to be marketed. There is consequently more industrial than consumer marketing, even though ordinary consumers are seldom exposed to it.

Task 1. Fill in the missing words from the text:

1. The 'selling concept' assumes that resisting ________ have to be persuaded by vigorous hard-selling techniques to buy non-essential goods or services.

2. The 'marketing concept' assumes that the producer's task is to find ______ and fill them.

3. Markets are consequently always looking for market _________.

4. Once a target market has been _______, a company has to decide what goods or services to offer.

5. The company must also take ______ of the existence of competitors.

6. Most companies undertake market ______ by collecting and analyzing information about the size of a potential market, about consumers' relations to particular product or service features, and so on.

7. The best-known classification is the '4 Ps': ______, place, promotion and ________.

8. Promotion groups together _______, publicity, sales promotion, an personal selling.

9. Price includes the basic list price, ______, the length of payment period, possible credit terms, and so on.

10. Few consumers realize that the ______ market is actually larger than the consumer market.

Task 2. Fill each gap with a suitable word from the box:

minimum rational profit (2) scarcity interests compromises classified agents purchased hand represent factors resources utilization interaction wants efficient

The Market System

The modern market economy is populated by three types of economic agents, whose __________constitutes economic activity: consumers, producers, and the government. The main social purpose of the economy is to produce goods and services for the satisfaction of the needs and __________of consumers.

Consumers, typically, represent households that provide labor, and other __________to produce against an income which they use to purchase consumer goods or to save.

Producers, typically, _________enterprises or firms that acquire ________o production, or inputs-labor, land and capital – from households and combine them to produce outputs, or commodities which can be __________into goods – tangible commodities- and services. The activities of firms move around the sale of their output at a ______.

The third basic element, the government, is involved with the economy, on the one hand, as a producer and consumer and, on the other _______, as a regulator, supervisor and promoter of economic activities.

The economic ________are engaged in a complex web of transactions involving factors of production and outputs. However, the volume of the commodities that can be produced and ______is limited by the ________of resources. This fact has two important consequences as regards economic decision-making:

1. The utilization of resources has to be ___________. In terms of the welfare of economic agents, the _________of resources is efficient when every opportunity has been exhausted to make some individuals better of without hurting the ________of others;

2. Individual economic agents and society as a whole cannot simply use more, they have to make _________between alternative uses.

Given these constraints, consumers, producers, and the government have to make _________decisions over available resources. Rational decisions reflect choices that draw maximum ________from given resources or obtain desired results with the ________efforts or cost.

Task 3. Match the words on the left with the definitions on the right.

1. distribution channel 

2 .to launch a product 

3. market opportunities

4. market research

5. market segmentation 

6. packaging 

7. points of sale 

8. product concept 

9. product features 

10. sales representative

A) all the companies or individuals involved in moving a particular good or service from the producer to the consumer; B) an idea for a new product, which is tested with target consumers before the actual product is developed; C) characteristics of a product: quality, price, reliability, etc. D) dividing a market into distinct groups of buyers who have different requirements or buying habits; E) place where goods are sold to the public - shops, stores, kiosks, market stalls, etc. F) possibilities of filling unsatisfied needs in sectors in which a company can profitably produce goods or services; G) someone who contacts existing and potential customers, and tries to persuade them to buy goods or services; H) collecting, analysing and reporting data relevant to a specific marketing situation (such as a proposed new product) I) to introduce a new product into the market  J) containers in which products are sold

Text 3. The law of Demand and Supply

The United States has a free enterprise economy. This type of economic system depends on cooperation between producers and consumers. To make a profit, producers provide products at the highest possible price. Consumers serve their own interests by purchasing the best products at the lowest possible price.

The forces of supply and demand establish the price that best serves both producers and consumers.

Demand is the desire to have some good or service and the ability to pay for it. You may want to take a round-the-world cruise or to rent a huge apartment that overlooks the ocean. Or you may want to buy a brand-new sports car or a state-of-the-art home entertainment center. However, you may not be able to afford any of these things.

Therefore, economists would say that you have no actual demand for them. Even though you want them, you don’t have the money needed to buy them. Conversely, you may want the latest CDs by several of your favorite bands. And, at a price of between $12 and $15 each, you can afford them. Since you have both the desire for them and the ability to pay for them, you do have demand for CDs.

Price is one of the major factors that influence demand. The law of demand states that when the price of a good or service falls, consumers buy more of it. As the price of a good or service increases, consumers usually buy less of it.

EXAMPLE Price and Demand

Let’s take a look at an example of demand in action. Cheryl, a senior at Montclair High School, loves movies and enjoys collecting them on DVD. She and Malik, a friend from school, sometimes meet downtown at Montclair Video Mart to look through the DVD stacks. Rafael, the owner of the video mart, often jokes that Cheryl and Malik spend so much time at his store that he might have to give them jobs. Actually, Cheryl already has a job—stocking shelves at her neighborhood supermarket.

She worked so many hours this summer that she has extra money to spend. Let’s see how DVD prices at Montclair Video Mart affect her spending decisions.

Cheryl has been saving to buy the DVD boxed set of the original Star Wars trilogy, one of her favorite series of movies. The set costs $69.95, and Cheryl has the money to buy it this weekend. When Cheryl goes to the Montclair Video Mart, she is disappointed to learn that the Star Wars set is sold out and a new shipment won’t arrive for a week. She decides to buy some other DVDs so that she won’t go home empty-handed, but she also decides to save roughly half of her money toward a future purchase of Star Wars.

As she looks through the movie DVDs, she sees that most of those she wants sell for $15. How many will she buy at that price? Let’s say she decides to buy three and keep the rest of her money for the Star Wars trilogy. But what if each of the DVDs she wants costs just $5? Cheryl might decide that the price is such a good deal that she can buy seven. As you can see, the law of demand is more than just an economic concept. It’s also a description of how consumers behave.

Change in Demand

Consider what might happen if you lose your job. If you aren’t earning money, you aren’t likely to buy many CDs or movie tickets or magazines - no matter how low the price. Similarly, when national unemployment rises, people who are out of work are more likely to spend their limited funds on food and housing than on entertainment.

Fewer people would be buying DVDs at every price, so market demand would drop. This is an example of a change in demand, which occurs when a change in the marketplace such as high unemployment prompts consumers to buy different amounts of a good or service at every price. Change in demand is also called a shift in demand because it actually shifts the position of the demand curve.

Six factors can cause a change in demand: income, market size, consumer tastes, consumer expectations, substitute goods, and complementary goods. An explanation of each one follows.

FACTOR 1 Income

If a consumer’s income changes, either higher or lower, that person’s ability to buy goods and services also changes. For example, Tyler works at a garden center. He uses his earnings to buy baseball cards for his collection. In the fall, people garden less and buy fewer gardening products, so Tyler works fewer hours. His smaller paycheck means that he has less money to spend, so he demands fewer baseball cards at every price.

Suppose, however, that Tyler is promoted to supervisor and receives a raise of $2 an hour. Now he has more money to spend, so his demand for baseball cards increases.

As you might guess, changes in income also affect market demand curves. When the incomes of most consumers in a market rise or fall, the total demand in that market also usually rises or falls. Increased income usually increases demand, but in some cases, it causes demand to fall. Normal goods are goods that consumers demand more of when their incomes rise. Inferior goods are goods that consumers demand less of when their incomes rise. Before his raise, Tyler shopped at discount stores for jeans and T-shirts. Now that he earns more, Tyler can afford to spend more on his wardrobe. As a result, he demands less discounted clothing and buys more name-brand jeans and tees.

Discounted clothing is considered an inferior good. Other products that might be considered inferior goods are used books and generic food products.

FACTOR 2 Market Size

If the number of consumers increases or decreases, the market size also changes. Such a change usually has a corresponding effect on demand. Suppose that the town of Montclair is on the ocean. Each summer, thousands of tourists rent beachfront cottages there. As a result, the size of the population and the market grows. So what do you think happens to the market demand curve for pizza in Montclair in the summer? Check the two graphs at the top of the next page.

Population shifts have often changed the size of markets. For example, in the last 30 years, the Northeast region of the United States lost population as many people moved to the South or the West. The causes of the population shift included the search for a better climate, high-tech jobs, or a less congested area.

One economic result of the migration is that the overall market size of the Northeast has shrunk, while the market size of the South and the West has grown. This change in market size has altered the demand for many products, from essentials such as homes, clothing, and food to nonessentials such as movie tickets. Demand for most items will grow in booming regions and decrease in regions that are shrinking.

FACTOR 3 Consumer Tastes

Because of changing consumer tastes, today’s hot trends often become tomorrow’s castoffs. When a good or service enjoys high popularity, consumers demand more of it at every price. When a product loses popularity, consumers demand less of it.

Advertising has a strong influence on consumer tastes. Sellers advertise to create demand for the product. For example, some people stop wearing perfectly good pants that still fit because advertising convinces them that the style is no longer popular and that a new style is better.

Think about your own closet. Doesn’t it contain some item of clothing that you just had to have a year ago, but would never pay money for now? You’ve just identified an instance of consumer taste changing demand. Consumer tastes also affect demand for other products besides clothing. When was the last time you saw someone buying a telephone that had to be attached to the wall by a cord?

FACTOR 4 Consumer Expectations

Your expectations for the future can affect your buying habits today. If you think the price of a good or service will change, that expectation can determine whether you buy it now or wait until later.

Automobiles usually go on sale at the end of summer because dealers want to get rid of this year’s models before the new models arrive. Would you expect demand for new cars to be higher in May, before the sales, or in August, during the sales? It is higher in August because consumers expect the sales and often choose to wait for them.

FACTOR 5 Substitute Goods

Goods and services that can be used in place of other goods and services to satisfy consumer wants are called substitutes. Because the products are interchangeable, if the price of a substitute drops, people will choose to buy it instead of the original item.

Demand for the substitute will increase while demand for the original item decreases. People may also turn to substitutes if the price for the original item becomes too high. Again, demand for the substitute rises while demand for the original item drops.

Substitutes can be used in place of each other. For example, when gasoline prices are high, some people decide to commute to school by bus or train. When gasoline prices are low, a higher number of people choose to drive instead of to take public transportation. As you can see from that example, when the price of one good rises, demand for it will drop while demand for its substitute will rise.

FACTOR 6 Complementary Goods

When the use of one product increases the use of another product, the two products are called complements. An increase in the demand for one will cause an increase in the demand for the other. Likewise, a decrease in demand for one will cause a decrease in demand for the other.

In contrast to substitutes, complements are goods or services that work in tandem with each other. An increase in demand for one will cause an increase in demand for the other. One example is CDs and CD players. Consumers who bought CD players also demanded CDs to play on them. And, as CDs became more popular, demand for CD players grew until they began to appear in places they had never been before, such as in the family minivan.

Therefore, with complements, if the price of one product changes, demand for both products will change in exactly the same way. If the price for one product rises, demand for both will drop. Conversely, if the price for one product drops, demand for both will rise.

The law of supply

Supply refers to the willingness and ability of producers to offer goods and services for sale. Anyone who provides goods or services is a producer. Manufacturers who make anything from nutrition bars to automobiles are producers.

So, too, are farmers who grow crops, retailers who sell products, and utility companies, airlines, or pet sitters who provide services.

The two key words in the definition of supply are willingness and ability. For example, the Smith family grows various fruits and vegetables on their small farm. They sell their produce at a local farmers’ market. If the prices at the market are too low, the Smiths may not be willing to take on the expense of growing and transporting their produce. Also, if the weather is bad and the Smiths’ crops of fruits and vegetables are ruined, they will not be able to supply anything for the market. In other words, they will not offer produce for sale if they do not have both the willingness and the ability to do so.

As is true with demand, price is a major factor that influences supply. The law of supply states that producers are willing to sell more of a good or service at a higher price than they are at a lower price. Producers want to earn a profit, so when the price of a good or service rises they are willing to supply more of it. When the price falls, they want to supply less of it. In other words, price and quantity supplied have a direct relationship.

EXAMPLE Price and Supply

Let’s take a closer look at how price and quantity supplied are related by returning to the Smiths and their produce business. The Smiths travel to the Montclair Farmers’ Market every Wednesday and Saturday to sell a variety of fruits and vegetables— blueberries, peaches, nectarines, sweet corn, peppers, and cucumbers. However, their specialty crop is the tomato. How should the Smiths decide on the quantity of tomatoes to supply to the farmers’ market? The price they can get for their crop is a major consideration.

The Smiths know that the standard price for tomatoes is $1 per pound. What quantity of tomatoes will the Smiths offer for sale at that price? They decide that they are willing to offer 24 pounds. What if the price of tomatoes doubled to $2 per pound? The Smiths might decide that the price is so attractive that they are willing to offer 50 pounds of tomatoes for sale on the market. In contrast, if the price fell to 50 cents, the Smiths might decide to supply only 10 pounds. Furthermore, at prices under 50 cents per pound, they may not be willing to supply any tomatoes. Look again at the definition of the law of supply. As you can see, it provides a concise description of how producers behave.

Task 1. Read the text again and find the definition of the following economic concepts: demand, the law of demand, a change in demand, income, complements, substitutes, market size, consumer expectations, consumer tastes, supply, the law of supply.

Task 2. Complete each statement below with the correct term from the list that follows:

supply demand schedule demand substitution effect law of demand change in quantity demanded elasticity of demand complementary products

1. A graph that shows the amounts consumers are willing to buy is a _______.

2. The seller’s side of each transaction is called _______..

3. The _______is usually greater for very expensive products.

4. A chart used to study the relationship between price changes and quantities consumers desire is a _______. .

5. The movement along a demand curve caused by a change in the price of the good or service is a _______. .

6. _______.is the concept that as the price decreases, the quantity sold increases.

7. The buyer’s side of each transaction is called _______. .

8. According to the _______. , when the price of an item increases, consumers will buy more of other items that are similar but cost less.

Task 2. Read the text below and decide which answer A, B, C or В best fits each space. Make your answers on the separate sheet of paper.

THE LONDON TEA TRADE

The London Tea Trade Centre is on the north (1) …. of the River Thames. It is the centre of an industry of (2)….importance in the (3) … lives of the British. Tea is without (4)… the British national drink: every man, woman and child over ten years of age has (5)… average over four cups a day or some 1500 cups annually. Some thirty per cent of the world’s export of tea makes its (6)… to London. Britain is (7)… the largest importer of tea in the world.

Samples of the vast amounts of tea brought into the country to (8)… the national thirst go to the London Tea Trade Centre, where they are tasted by (9)… professional tea tasters before being sold at each week’s tea sale. It is fascinating to see them at (10) … Over a hundred samples are (11)… in line on long tables. Teas are generally tasted with milk, (12)… that is how the majority in Britain drink their tea. The tasters move down the line with surprising (13)…, tasting each sample from a spoon and deciding what is a (14)… price for each tea.

The types of tea that are popular in Britain are (15)… inexpensive but they are a very high quality. The best are delicate (16)… of numerous teas from different sources and countries of origin.

1. A bank B border C shore D coast

2. A higher B wide C great D large

3. A common B typical C everyday D usual

4. A doubt B dispute C disbelief D uncertainly

5. A for B by C at D on

6. A route B way C direction D journey

7. A considerably B by far C largely D by much

8. A satisfy B match C answer D serve

9. A effective B skilled C developed D handy

10. A action B operation C practice D work

11. A composed B put up C settled D laid out

12. A out of B since C so D owing to

13. A speed B hurry C rush D dash

14. A fine B right C fair D deserved

15. A roughly B comparatively C slightly D approximately

16. A mixtures B associations C unions D gatherings

Task 3. Write an essay on the issue: The relationship between supply and demand.

UNIT 4

BANKING AND TAXATION

Text 1. Types of banks 

Task 1. Read the text below and write short headings (one or two words) for each paragraph:

……………………………..

Commercial or retail banks are businesses that trade in money. They receive and hold deposits, pay money according to customers’ instructions, lend money, offer investment advice, exchange foreign currencies, and so on. They make a profit from the difference (known as a spread or a margin) between the interest rates they pay to lenders or depositors and those they charge to borrowers. Banks also create credit, because the money they lend, from their deposits, is generally spent (either on goods or services, or to settle debts), and in this way transferred to another bank account – often by way of a bank transfer or a cheque (check) rather than the use of notes or coins – from where it can be lent to another borrower, and so on. When lending money, bankers have to find a balance between yield and risk, and between liquidity and different maturities.

……………………………

Merchant bank in Britain raise funds for industry on the various financial markets, finance international trade, issue and underwrite securities, deal with takeovers and mergers, and issue government bonds. They also generally offer stockbroking and portfolio management services to rich corporate and individual clients. Investment banks in the USA are similar, but they can only act as intermediaries offering advisory services, and do not offer loans themselves. Investment banks make their profits from the fees and commissions they charge for their services.

……………………………..

In the USA, the Glass-Steagall Act of 1934 enforced a strict separation between commercial banks and investment banks or stockbroking firms. Yet, the distinction between commercial and investment banking has become less clear in recent years. Deregulation in the USA and Britain is leading to the creation of ‘financial supermarkets’: conglomerates combining the services previously offered by banks, stockbrokers, insurance companies, and so on. In some European countries (notably Germany, Austria and Switzerland) there have always been universal banks combining deposit and loan banking with share and bond dealing and investment services.

………………………………

A country’s minimum interest rate is usually fixed by the central bank. This is the discount rate, at which the central bank makes secured loans to commercial banks. Banks lend to blue chip borrowers (very safe large companies) at the base rate or the prime rate; all other borrowers pay more, depending on their credit standing (or credit rating, or creditworthiness): the lender’s estimation of their present and future solvency. Borrowers can usually get a lower interest rate if the loan is secured or guaranteed by some kind of asset, known as collateral.

……………………………

In most financial centres, there are also branches of lots of foreign banks, largely doing Eurocurrency business. A Eurocurrency is any currency held outside its country of origin. The first significant Eurocurrency market was for US dollars in Europe, but the name is now used for foreign currencies held anywhere in the world (e.g. yen in the US, DM in Japan). Since the US$ is the world’s most important trading currency – and because the US has for many years had a huge trade deficit – there is a market of many billions of Eurodollars, including the oil-exporting countries’ ‘petrodollars’. Although a central bank can determine the minimum lending rate for its national currency it has no control over foreign currencies. Furthermore, banks are not obliged to deposit any of their Eurocurrency assets at 0% interest with the central bank, which means that they can usually offer better rates to borrowers and depositors than in the home country.

 

Task 2. Match up these terms with the definitions below:

 

Cash card        cash dispenser credit card       home banking

Loan    mortgage         overdraft         standing order

Current account (GB) or checking account (US)

Deposit account (GB) or time or notice account (US)

 

1. an arrangement by which a customer can withdraw more from a bank account than has been deposited in it, up to an agreed limit; interest on the debt is calculated daily

2. a card which guarantees payment for goods and services purchased by the cardholder, who pays back the bank or finance company at a later date

3. a computerized machine that allows bank customers to withdraw money, check their balance, and so on

4. a fixed sum of money on which interest is paid, lent for a fixed period, and usually for a specific purpose

5. an instruction to a bank to pay fixed sums of money to certain people or organizations at stated times

6. a loan, usually to buy property, which serves as a security for the loan

7. a plastic card issued to bank customers for use in cash dispensers

8. doing banking transactions by telephone or from one’s own personal computer, linked to the bank via a network

9. one that generally pays little or no interest, but allows the holder to withdraw his or her cash without any restrictions

10. one that pays interest, but usually cannot be used for paying cheques (GB) or checks (US), and on which notice is often required to withdraw money

Task 3 Find the words or expressions in the text which mean the following:

 

1. to place money in a bank; or money placed in a bank

2. the money used in countries other than one’s own

3. how much money a loan pays, expressed as percentage

4. available cash, and how easily other assets can be turned into cash

5. the date when a loan becomes repayable

6. to guarantee to buy all the new shares that a company issues, if they cannot be sold to the public

7. when a company buys or acquires another one

8. when a company combines with another one

9. buying and selling stocks or shares for clients

10. taking care of all a client’s investments

11. the ending or relaxing of legal restrictions

12. a group of companies, operating in different fields, that have joined together

13. a company considered to be without risk

14. ability to pay liabilities when they become due

15. anything that acts as a security or a guarantee for a loan

Task 4. Match up the verbs and nouns below to make common collocations:

 

Charge             advice

Do                    bonds

Exchange          business

Issue                currencies

Make                deposits

Offer                funds

Pay                  interest

Raise                loans

Receive             profits

Underwrite       security issues

 

Text 2. History of money.

What makes the world go round?

 

Money – it jingles in your pocket, it rustles in your wallet and it clinks in your piggy-bank. Money makes the world go round, but what’s it? It’s a store of value or a measure of wealth. Money is anything that is generally accepted as payment for goods and services. This is a wide definition and, over the centuries, money has appeared in all shapes and sizes; cowrie shells in ancient China, huge stone discs on a South Pacific Island or beads (Wampum) for the North American Indians.

From Chickens to Plastic 

At the end of the day, of course, it doesn’t really matter what shape or size the money takes, as long as everyone recognises it and accepts it in payment. But, over the course of history, money has predominantly been associated with metals, in particular gold, silver and copper. 

Bartering 

Before metal money become the usual means of exchange, people would swap goods and services in a process known as bartering – “I’ll swap you ten chickens for your goat”. This kind of exchange does not really encourage trade, as all sorts of problems arise; are all the chickens of the same size? If I’ve only got five chickens, can I buy half a cow? Obviously, precious metals are a practical alternative to payment in kind. 

Four Essential Qualities

For money to be practical and efficient it should possess these qualities:

Durability – in prison, cigarettes may become a medium of exchange – but they’re easy to break and quickly dry up; in other words, they don’t last.

Portability – in some parts of Africa your wealth is measured in cattle. This is fine if you’re trading locally, but if money isn’t easy to carry, how can trade develop?

Divisibility – small units make life much easier – imagine trying to buy a hot dog in New York if the $100 bill was the lowest unit of currency!

Intrinsic value – money should have some worth in itself, otherwise it won’t inspire confidence. 

Coins

We first read of coins in the Kingdom of Lydia in the 7^th century BC. Their coins were of equal weight and therefore of equal value, simplifying trade. Stamping a design onto the coins is called “minting”; Alexander the Great introduced the practice of stamping a picture of the sovereign’s head on the coins, an idea that was soon copied. Coins however, were not always as valuable as they seemed – they were often clipped or shaved by unscrupulous individuals or debased by the state. The Romans, with the economic pressure of the Punic wars, began a long process of debasement, mixing more and more copper in with the silver, so that the intrinsic value of the coin was far lower than the marked face value.

  

Paper Money

Bank notes were first introduced by the Chinese in the 10^th century. They were later used by governments in dire financial straits – caused by things like having to finance a war, for example. The English colonies in North America made important strides in the use of bank notes. For various political and economic reasons, the Colonists often found themselves short of coinage. To get round this problem, they used first wampum, the tobacco, rice and whisky or brandy – not exactly the most practical solution. The first paper money issue was by the Massachusetts Bay Colony in 1690. The practice was frowned upon and eventually banned by the mother country, but the inventive money-making instincts of the new United States of America meant that, during the 19th century, most of the money used was in the form of paper dollars. The first fully printed note in England was issued in 1855 – until that time the cashier had to write the name of the payee and sign each note individually.

At first, bank notes were redeemable for gold – on Bank of England notes you will see written “I promise to pay the bearer on demand the sum of…” If you took a ten-pound note to the Bank they used to have to give you ten pounds in gold coin. Britain left the gold standard in 1931 and thus the notes are no longer backed by gold.   

Plastic money

Nowadays many transactions are carried out with “plastic money” such as credit cards. The newest are called “smart cards” and carry small silicon chips that can record every transaction on the card. Research into the cards of the future continues, but the latest development is e-cash, cash to be used across the Internet – you’ll be able to spend money from the comfort of your armchair. If only earning the damn stuff was so easy!  

So, money is so central to our lives that it has spawned a wealth of specific terminology, idioms and sayings. Great thinkers in all ages have had something to say about it; governments are elected on the strength of how they plan to manage it, empires rise and fall because of it.

Money is so important to us – people even say it makes the world go round.

Task . Write an essay on the issue Money makes the world go round

Text 3. Counterfeiting

“Where there is money, there is counterfeit money”.

By V.N. Borzykh, Director of the museum of the History of Banking

Counterfeiting of money is one of the oldest crimes in history. In the United States, for example, it was a serious problem in the past, when each bank issued its own currency. Therefore they adopted a national currency in 1863. But it did not solve the counterfeiting problem. The national currency or the dollar was soon counterfeited so widely, that it became necessary for the US Government to take special measures. In 1865 the United States Secret Service was established to suppress counterfeiting. It helped to a certain extent but this crime still exist.

Brief History of Counterfeit Money

Twenty seven centuries ago, the rulers of the Eastern Mediterranean countries began to mint coins on a mass scale. Coins were standard pieces of gold, silver and other metals that could conveniently be used in one transaction after another. Counterfeiting emerged almost simultaneously with the appearance of money, as proved by the Athenian laws dating from the 6^th century B.C.

Counterfeit money was an easy way of getting rich. All you had to have was some skills in minting and an outlet for putting your product on the market. This last was, and still is, very important, as counterfeiters are mostly caught by counterfeit money being traced back to its source.

The counterfeiting involved producing coins of high nominal value similar to the real money but containing less precious metal than required. Highly skilled counterfeiters of ancient Greece brought the silver content in their products down to ten percent of the stipulated amount. “Gold” coins were also often minted from lead, and “silver” coins, from copper.

In medieval Europe, especially in the period between the fifteenth and the seventeenth centuries, great amount of counterfeit money in circulation ruined the money systems of a number of countries.

Production of counterfeit money undermines the states principal monopoly, emission of currency, and has therefore always been regarded as a most heinous criminal offense. For centuries counterfeiters had their hands cut off, they were tortured, hanged, drowned, nailed to the gates of mints, burned alive. Until the middle of the 18^th century, Russian counterfeiters were executed by pouring molten metal down their throats.

Some of the better known counterfeiters of all times were the Roman emperor Claudius Caesar Nero (1^st century , A.D.), the French king Philip 1V the Handsome (late 13^th - early 14^th centuries), also nicknamed Counterfeiter, and Fridrich the Great, king of Prussia (18^th century).

Copper coins were widely used in those times in Europe , while in Russia only silver coins had currency, and there was not enough silver to keep the value of coins level with the value of silver. In 1654, Czar passed a decree on putting into circulation silver coins whose nominal value was much higher than the real value of the silver contained in them. The same decree introduced copper coins that were to be treated as if they were made of silver, although copper was at that time 60 times cheaper than silver.

The operation brought the state treasury four million rubles, or two annual budgets, in net profit, but it also entailed a collapse of the country’s entire economy. This resulted in the 1662 uprising in Moscow which was later called the Copper Mutiny. A year later, copper coins were dropped as a means of circulation for several decades.

In the reign of Petеr the Great the spoiling of money became one of the principal sources of state revenue.

With the introduction of paper money, specialists in counterfeiting it also appeared. The first banknotes were issued in Russia under Catherine II in 1769.

In the decade between 1787 and 1797, counterfeit banknotes to the value of 170,000 rubles were withdrawn from circulation throughout the Russian empire.

The late 18^th and early 19^th centuries saw the rise of counterfeiting money of certain states by hostile countries intent on undermining their economy. Thus the English counterfeited the banknotes of revolutionary France and napoleondores, while Emperor Napoleon issued masses of Austrian, Prussian and English paper money.

On the eve of Napoleon’s invasion of Russia in 1812 counterfeiting of 25, 50 and 100 ruble banknotes was started in Paris. The banknotes were rather skillfully made, with all the necessary stamping and watermarks.

Dozens of million rubles worth of counterfeit money was brought to Russia by Napoleon’s army. In 1813, the Russian government circulated secret orders describing the special features of counterfeit banknotes, which were then exchanged for genuine money and destroyed. The process went on for more than ten years. The country sustained considerable losses. In 1820 alone some seven million rubles were paid for the counterfeit banknotes withdrawn from circulation. To compare: only five million rubles were spent on rebuilding Moscow burned down in 1812.

In the 19^th and 20^th centuries counterfeiting was fairly widespread in Russia. The government fought this evil by sentencing the culprits to hard labor and continually improving the safeguards against counterfeiting.

Spoiling the money by state mints gradually disappeared with the introduction of paper money on a mass scale. The state now achieves the same result by printing more and more money and throwing it onto the market, whereupon great efforts have to be made to curb inflation and rocketing prices.

Task 1. Find in the text:

Страны Ближнего Востока; в огромных количествах; как доказано Афинскими законами еще в 6 веке до н.э.; фальшивомонетчиков чаще всего ловят, отслеживая источник фальшивых денег; высокая номинальная ценность; искусные фальшивомонетчики древней. Греции снизили до 10% содержание серебра в монетах от их номинальной стоимости; большое количество фальшивых денег в обращении подрывало экономическую государственную систему; банкноты со всеми необходимыми штампами и водяными знаками; страна понесла значительные потери; сдерживать инфляцию.

Task 2. Speak about:

1. Counterfeiting of money in ancient times.

2. Counterfeiting of money as one of the most heinous criminal offenses.

3. Counterfeiting of money in 19^th-20^th centuries.

4. Counterfeiting of money in modern world.

Text 4. What are taxes?

Taxes are a compulsory financial contribution by a person or body of persons towards the expenditure of a public authority. In modern economies taxes are the most important source of government revenues. Taxes on income (i.e. on wages, salaries, profits, dividends, rent and interest) and on capital are known as ‘direct’ taxes. Taxes on commodities or services are known as ‘indirect’ taxes.

Taxes are considered to have three functions:

1. fiscal or budgetary, to cover government expenditures;

2. economic, to give effect to economic policy, to promote stable economic growth;

3. social, to increase the economic welfare of the community.

In the USA nearly all of the federal government’s revenues come from taxes. By far the most important source of tax revenue is the personal income tax. Gross receipts from corporate income taxes yield a far smaller percentage of total federal receipts. Individual states levy their own taxes. As a result, the profits of a corporation are liable to federal and sometimes state corporate income taxes. This often imposes a double tax burden. When the after-tax income is paid out to stockholders as dividends, it is then taxed again as personal income.

In the UK there is no single code of tax law, the body of tax legislation being increased by each year’s Finance Act. The United Kingdom operates a ‘schedular’ system, whereby taxable income from different sources is calculated and taxed under the rules of a particular ‘schedule’.

Under Russian law, all Russian legal entities are subject to the profit tax law. Foreign entities that have a taxable permanent establishment in Russia are also taxed under this law.

Russian taxes provide revenue for three tiers of the budget: federal, regional and local. The major taxes paid to the budget are: profit tax, value-added tax (VAT), securities tax, withholding tax.

The Russian government tries to create a climate in which business can thrive, to keep the tax burden as low as possible. It also attempts to eliminate tax allowances, which deprive the budget of tax revenues, and to improve tax collection.

A number of countries have problems because of significant taxpayer non-compliance. Along with cases of illegal evasion of tax obligations there are entirely legal ways of avoidance by which a person may so arrange his affairs as to minimize, or even eliminate, tax liability on his property and income.

Russian tax system has undergone significant changes over the last few years: the Tax Code has been worked out and a number or related laws have been adopted. Yet the system is criticized and businessmen consider it complicated and unfair. The government is working to improve tax administration to close the loopholes for tax evasion.

Task 1. Find English equivalents for:

Налогообложение; подоходный налог; прямые и косвенные налоги; благосостояние общества; облагать налогом; налоговое бремя; налог на корпоративный доход; доход после налогообложения; система «шедул»; налог на добавочную стоимость; налог на ценные бумаги; налог с суммы дивидендов; налог на прибыль; отменить налоговые льготы; обязательства по уплате налогов; уклонение от налогов; налоговое администрирование; лазейки.

Task 2. Which terms do the following descriptions define?

1. The tax people pay on their wages and salaries

1. capital transfer tax B. income tax C. wealth tax

2. A tax on wages and salaries or on company profits

1. direct tax B. indirect tax C. value-added tax

3. A tax levied at a higher rate on higher incomes

1. progressive tax B. regressive tax C. wealth tax

4. A tax paid on property, sales transactions, imports

1. direct tax B. indirect tax C. value-added tax

5. Profits made by selling assets are generally liable to a

1. capital gains tax B. capital transfer tax C. wealth tax

6. Gifts and inheritances over a certain value are liable to a

1. capital gains tax B. capital transfer tax C. wealth tax

7. Making false declarations to the tax authorities

1. fiscal policy B. tax avoidance C. tax evasion

8. Reducing the amount of tax you pay to a legal minimum

1. Creative accounting B. tax avoidance C. tax evasion

Task 3. Name kinds of taxes levied in the USA, the UK and in Russia.

Task 4. Read the dialogue and translate the Russian remarks into English:

Foreigner: The tax system in Russia has changed significantly over the years of the reforms. But businessmen and individuals still complain that the system of taxation is unfair and inadequate.

Russian: Да, это так. Несмотря на огромную работу в области налогового законодательства, проделанную за годы реформ, наша налоговая система постоянно критикуется представителями бизнеса, законодательной и исполнительной ветвями власти. Учитывая это, мы сейчас продолжаем работать над налоговым кодексом.

F.: What concept underlines this document?

R.: Прежде всего мы считаем необходимым снизить налоговое бремя на товаропроизводителя. Мы планируем сделать это путем снижения налоговых ставок, а также за счет постепенного увеличения налогов с физических лиц. Мы также намерены отменить многие налоговые льготы, которые лишают бюджет значительных налоговых доходов.

F.: Our tax system is based on the same principles and it works rather well. From our experience I can say that more emphasis should be placed on tax collection in your country.

R.: Вы абсолютно правы. Наше правительство принимает меры по повышению собираемости налогов, усиливает контроль за лицами, имеющими высокие доходы, за платежами в Пенсионный фонд. Мы пытаемся закрыть все лазейки для лиц, уклоняющихся от уплаты налогов. Вот суть нашей налоговой политики.

F.: Life shows that a system works effectively where the policies are right. Let’s hope you are on the right way.

Text 5. TAXATION (AND HOW TO AVOID IT!)

Read the text and decide which paragraphs could be given the following headings.

• Advantages and disadvantages of different tax systems

• Avoiding tax on profits

• Avoiding tax on salaries

• Tax evasion

• The functions of taxation

A The primary function of taxation is, of course, to raise revenue to finance government expenditure, but taxes can also have other purposes. Indirect excise duties, for example, can be designed to dissuade people from smoking, drinking alcohol, and so on. Governments can also encourage capital investment by permitting various methods of accelerated depreciation accounting that allow companies to deduct more of the cost of investments from their profits, and consequently reduce their tax bills. В There is always a lot of debate as to the fairness of tax systems. Business profits, for example, are generally taxed twice: companies pay tax on their profits (corporation tax in Britain, income tax in the USA), and shareholders pay income tax on dividends.

B Income taxes in most countries are progressive, and are one of the ways in which governments can redistribute wealth. The problem with progressive taxes is that the marginal rate - the tax people pay on any additional income - is always high, which is generally a disincentive to both working and investing. On the other hand, most sales taxes are slightly regressive, because poorer people need to spend a larger proportion of their income on consumption than the rich.

С The higher the tax rates, the more people are tempted to cheat, but there is a substantial 'black' or 'underground' economy nearly everywhere. In Italy, for example, self-employed people - whose income is more difficult to control than that of company employees - account for more than half of national income. Lots of people also have undeclared, part-time evening jobs (some people call this 'moonlighting') with small and medium-sized family firms, on which no one pays any tax or national insurance. In 1986, the Director of the Italian National Institute of Statistics calculated the size of the underground economy, and added 16.7% to Italy's gross national product (GNP) figure, and then claimed that Italy had overtaken Britain to become the world's fifth largest economy.

D To reduce income tax liability, some employers give highly-paid employees lots of perks or benefits instead of taxable money, such as company cars, free health insurance, and subsidized lunches. Legal ways of avoiding tax, such as these, are known as loopholes in tax laws. Life insurance policies, pension plans and other investments by which individuals can postpone the payment of tax, are known as tax shelters. Donations to charities that can be subtracted from the income on which tax is calculated are described as tax-deductible.

E Companies have a variety of ways of avoiding tax on profits. They can bring forward capital expenditure (on new factories, machines, and so on) so that at the end of the year all the profits have been used up; this is known as making a tax loss. Multinational companies often set up their head offices in countries such as Liechtenstein, Monaco, the Cayman Islands, and the Bahamas, where taxes are low; such countries are known as tax havens. Criminal organizations, meanwhile, tend to pass money through a series of companies in very complicated transactions in order to disguise its origin from tax inspectors - and the police; this is known as laundering money or money laundering.

Task 1 Find words in the text that mean the following.

1. reducing the value of a fixed asset, by charging it against profits;

2. something which discourages an action;

3. an adjective describing a tax that is proportionally higher for people with less money;

4. spending money to buy things, rather than saving it;

5. working for yourself, being your own boss;

6. a tax on incomes that pays for sickness benefit, unemployment benefit, and old-age pensions;

7. non-financial benefits or advantages of a job;

8. a way to delay the payment of tax to a later time;

9. an adjective describing expenditures that can be taken away from taxable income or profits;

10. a country offering very low tax rates to foreign businesses.

Task 2. According to the text, are the following statements TRUE or FALSE?

1. Taxes can be designed both to discourage and to encourage spending.

2. The same amount of money can be taxed more than once.

3. Progressive taxes may discourage people from working extra hours.

4. Sales taxes are unfair because poor people spend more than the rich.

5. The Italian government knows that about one seventh of national income escapes taxation.

6. ‘Loopholes’ are a common form of tax evasion.

7. If you pay a lot of your income into a pension fund or a life insurance policy you never have to pay tax on it

8. A company that makes an unusually large profit during a tax year might quickly decide to spend it, for example, on a new factory or equipment

Unit 5

RECRUITMENT

Text 1. MANAGING PEOPLE

If the small business entrepreneur is going to have a growing and successful business, that person must understand how to manage one of the business’s most important resources, people.

The main objective of the personnel function is to recruit and maintain an efficient work force. This calls for the effective management of people, ensuring a good relationship between people and fostering opportunities for individual development.

The finding and keeping of good employees is not easy. A small business owner should aim to hire those individuals who are best qualified to fill the job recruitments. The education, experience and personality of each candidate must be carefully considered. The selection of effective personnel is essential if a business is to grow and prosper. Before selecting an employee, the following points need to be considered:

• A description of the job to be fulfilled.

• A source of applicants.

• A basis for selecting the best candidate.

• A training program for the individual after hiring.

Position description has two parts. The first is a job description, which includes the main tasks and responsibilities of the position. The second part is called the job specification. This part defines the education, work experience, skills, and abilities the individual must have in order to perform the job effectively.

Sources of employees. It is better to seek out applicants for employment rather than wait for them to come to your business. Recruiting is the practice of actively seeking workers rather than waiting for them to come to you. A number of sources of possible workers are:

• Suppliers are good source of possible applicants.

• Private and public employment agencies, usually for a fee, can help find the right applicant.

• High schools, vocational and technical schools, business schools, and colleges offer assistance to employers.

• “Help Wanted” advertisements for applicants in the classified section of newspapers are beneficial, but they must be specific about the job requirements.

• Additional sources of personnel include radio and television announcements, and referrals from your employees, your friends, business associates, and customers.

The application form. Application forms should fit the needs of the company and conform to the law. The purpose is to furnish the personnel manager with enough information about applicants so that a judgment as to their qualifications for a job can be made. Only questions referring to a person’s ability to perform a job are permissible.

The employment interview. Before conducting an interview, the interviewer should become familiar with the application. Then the applicant should be put at ease and encouraged to discuss items on the application which need to be clarified. The interviewer should take enough tine to obtain information on which to base a discussion.

Testing the applicant. Many forms of tests are used to determine an applicant’s aptitudes, attitudes, skills and suitability or employment. The nature of the work to be performed determines the type of test to be used.

References. Before deciding to hire an individual, the references which have been provided should be checked. References are persons who have known the applicant for some time and their information may be helpful.

Employee training includes any activity that provides information or the development of skills that improves the employee’s performance.

There is on-the-job and formal training. On-the job training which an employee usually receives after being hired is an orientation to the company and the job. The training may consist of an employee manual plus some information provided by the employee’s boss. Formal training refers to organized instruction in a workshop or classroom situation. One of the best sources for the small business employer can be found in adult educational programs. These programs benefit both the employer and trainee as they are of high quality and are usually free. Other forms of education, such as special or technical university courses , are sometimes useful in upgrading specific employees.

Task 1. Answer the following questions:

1. What is the main objective of the personnel function?

2. What factors about each candidate must be carefully considered?

3. Before selecting an employee, some points need to be considered. What are they?

4. The employment interview, testing the applicant and references, which one is more effective? What would you prefer if you were a personnel manager?

5. Is employee training necessary only for an employee or for a firm? Or is it necessary for both of them?

6. What are the forms of employees’ upgrading?

Task 2. Match the words with their definitions:

applicant, specification, fee, personnel, to manage, personnel manager, interview, aptitude, to train

1. The entire body of persons employed by an organization.

2. Natural ability or cleverness suited to a particular kind of work or activity.

3. A person who applies for employment.

4. A very detailed written statement giving a description of the form and content of an article or commodity, or the process by which something is produced.

5. To direct, control, take charge of (a business or organization).

6. A meeting, especially of two people to do business, or to decide whether one of the persons is fit for a post.

7. A manager responsible for all matters concerning the employment of the staff.

8. A payment for a piece of professional advice or some special service.

9. To teach somebody a skill, occupation or profession.

Task 3. Supply the sentences with the missing words:

employment, applicants, objectives, qualification, skills, purposes, requirement, experience, performed, training

1. The ceremony was _____at the same time in nineteen other countries.

2. One of the ______you need in advertising is a fertile mind.

3. He had retired from regular______.

4. Math is no longer a prime ______for a career in accounting.

5. There was a long waiting list of______for jobs.

6. He attended evening______courses on advertising making.

7. She’s had nine months’_______.

8. They acted with great ______and conviction.

9. Complete secrecy was essential to our _____.

10. If this policy is reversed we’ll never achieve our _____.

Task 4. Use the words in capitals to form a word that fits in the space in the same line.

The job interview

It is important to make a good (0)……when going 0 IMPRESS

for a job interview. Interviewers usually ask a (1)…of 1 VARIOUS

questions, many of which concern (2)…. . However, they 2 QUALIFY

also usually like to ask questions about previous (3)….as 3 OCCUPY

well as (4)……not connected to the work place. Often, the 4 ACHIEVE

(5)….candidate is not the one with the most impressive 5 SUCCESS

(6)….but the one who shows that he or she has made 6 EDUCATE

the most (7)….use of their time. Few employers want 7 EFFECT

employees who are (8)….to think for themselves. The 8 ABLE

(9)….of advancement in any job very rarely depends on 9 POSSIBLE

the (10)….. of work but more on the enthusiasm and 10 ACCURATE

dedication of the employee.

Working abroad

Going to work abroad can prove to be quite

a (1)… experience. Learning how to adjust 1. VALUE

to (2)… cultures is both character building and 2. FOREIGNER

strengthening. Many people who give in to the (3)… 3. TEMPT

of living abroad, do so in search of a more (4)… 4. ADVENTURE

life. However , the whole concept of leaving your home country

must be (5)… thought out. Problems such as finding 5. CARE

(6)… and (7)… procedures 6 ACCOMODATE, 7. IMMIGRATE

should be considered well

in advance. For the first few weeks abroad,

you may fill terribly (8)… and homesick.(9)… 8. LONELINESS , 9. COMMUNICATE

problems may also lead to

unnecessary (10)… with the locals, 10. UNDERSTANDING

so it is useful to (11)… 11. FAMILIAR

yourself with both the language of the country and its

customs before you go.

Text 2 . Preparing for an Interview

How to behave during an interview

You may be interviewed in different ways, but the interviewer will have a clear-cut aim — to find out what sort of a person you are. In addition, he will be appraising whether you have the necessary set of knowledge and skills. Therefore, you must be ready to answer the most unexpected questions and paint in vivid detail your relevant previous ехреrience.

Be ready for your interviewer to assess what you can do for the com­pany that is going to employ you. You should be ready for questions like: “How do you see your future duties?”, and you should learn as much as possible about the company you are dealing with before the inter­view. It would be a good idea to investigate the specific requirements of various positions, to assess yourself impartially and, in answering the questions, to try to compensate for your possible shortcomings with the undoubted advantages of your experi­ence.

The next question will usually be — "What are your strong points?" Remember that an answer like: "I can do "everything" is unsuitable. The enu­meration of your genuinely valuable merits — "I am energetic, hard-work­ing, loyal and so on" — will produce no effect unless you back them up with concrete examples.

"What are your weak points?" You must also be able to answer this question, and you may be sure that your interviewer will attentively fol­low how you react. Be ready to speak about failures or mistakes in your career, since no one will believe that you had none, but don't run to the other extreme—don't start enu­merating all of your slip-ups. Be sure to emphasize the conclusions you have drawn after analyzing your failures, and tell your interviewer what they taught you. Just remember that an employee who has the experience of overcoming failures and analyzing his own mistakes is much more valuable -for the company -because he won't lose his head when facing difficulties.

Think about the achievements you can mention at the interview. If you can't answer questions about them, or mumble something unintelligible, your chances of succeeding in the interview won't be great. If possible, quote concrete figures or examples so that your interviewer can assess the extent of your success.

Be ready for practical tests — if you apply for a job as a salesperson you may be asked to sell something (this is a good test of your abilities) or you may be required describing some production situation, to express your opinion on the settlement of the con­flict in a hypothetical situation.

What salary are you expecting? Think of concrete figures — you should base your answer on the aver­age salary of other employees with your qualification. If you are sure the company is very interested in you, you may increase your demands but, naturally, not to scare off your-employer.

Usually they will ask, at the end of an interview if there is anything you would like to know. This is your turn to interview a staff member. You have to understand what your future job will entail, what supervisors will expect, what possible difficulties there are in store for you, what the other staff members are like and so on. No matter how interested you are in tops position, remember that even if you are selected, you’ll have to show your skills in practice and it will be clear whether you meet the requirements of the post or not.

Task 1 . Insert the following words in the gaps in the text below:

applicant application application form apply employment agencies

curriculum vitae or CV (GB) or resume (US) interview job description

job vacancies candidate references short-listed

Many people looking for work read the (1) ______advertised by companies and (2) _________in newspapers or on the internet. To apply to an advertisement is to (3) _______for a job. You become a (4) ______or an (5)_______. You write an (6)_____ or fill in the company’s (7) _____, and send it, along with your (8)______and a covering letter. You often have to give the names of two people who are prepared to write (9) ________for you. If your qualifications and abilities match the (10) _______, you might be (11) ______, i.e. selected to attend an (12) _______.

Text 3. Read the dialogue and speak on the following points:

• the mistakes a candidate can make in an interview;

• the qualities a candidate must have;

• personnel manager’s advice to interviewees;

• the kind of things a candidate must have.

When a company needs to recruit or employ new people, it may decide to advertise the job or position in the appointing page of a newspaper. People who are interested can then apply for the job by sending in a letter of application and curriculum vitae containing details of their education and experience. The company will then drop up a list of candidates, who are invited to attend an interview. See how the Personal Manager of a company answers questions about the way he interviews and selects candidates.

Personnel Manager: The most important thing when interviewing a candidate is his character, his ability to react, his intelligence and his suitability for the position for which he is being interviewed.

Reporter: And to what extent does the person’s appearance influence your decision?

P.M.: It is important that the person is well presented, is neat and tidy, and that she or he has good manners, because that shows a lot about personality.

R.: Do you expect a candidate to be prepared in any way for the interview, or how should he prepare himself for the interview?

P.M.: Normally the candidate has had one or two interviews with junior members of the staff before he gets to my level, and I expect the person concerned to have a good knowledge of what the company does, what he’s expected to do, and who he’s going to report to. If the candidate doesn’t give the impression of understanding one of those three items, then he gets marked down accordingly.

R.: How does a candidate go wrong?

P.M.: The major way a candidate goes wrong is by basically becoming a yes-man or a yes-woman and agreeing with everything you say. Also you have to feel that a candidate is going to be good and he has to show himself to be not just “Yes, sir, thank you very much. Yes, I agree with that.” Sometimes I lay dummy questions, in which I want a “no” answer, and if he continues to say “yes” than he goes down.

R.: What would you advise to a candidate, going to an interview?

P.M.: I would say to him first of all to listen; secondly, to ask the right questions; and; thirdly, perhaps, the most important, to create the right kind of relationship, I would call it an adult-to-adult relationship with the interviewee or the interviewer. When you get a yes-man in front of you, he is creating an adult-to-a-child conversation and in most cases managers are not interested in employing a child.

1. Find the synonyms in the dialogue for these words:

1. a candidate

2. to affect

3. personnel

4. a grown-up

5. to be mistaken

6. to hire

7. looks

8. well-bred

9. post

10. interrelation

Task 2. Write a letter of application. Use these notes to help you.

Letter of application

Paragraph 1: Say why you ‘re writing and where you saw the advertisement.

Useful words and phrases:

Dear Sir/Madame, I am writing in response to your advertisement in… I would like to apply for the post of…

Paragraph 2: Summarize the suitable qualification you have for the job.

Useful words and phrases:

As you can see from my CV… I am a qualified… instructor.

In addition, I hold certification in…

I am a fluent/good speaker of…

Paragraph 3: Summarize the relevant experience you have.

Useful words and phrases:

Furthermore, I have the relevant experience you are looking for. For the last five years I have…

Two years ago I was…

Paragraph 4: Say why you would like the job.

Useful words and phrases:

There are a number of reasons why I would like to…

Firstly, secondly, thirdly, furthermore, what is more, I hope to gain, I enjoy working with…

This will be an opportunity to…

Say thank you and sign off:

I look forward to hearing from you soon.

Yours faithfully,

(your full name)

Write 100-159 words.

Curriculum vitae (GB) or Resume (US)

Curriculum vitae

YOUR NAME Your address Your phone number(s) Your e-mail address Your date of birth

OBJECTIVE

WORK EXPERIENCE or PROFESSIONAL EXPERIENCE

EDUCATION or QUALIFICATIONS

COMPUTER SKILLS

LANGUAGES

HOBBIES AND INTERESTS

REFERENCES [or Testimonials (US)] The following people can provide references:

Notes on Curricula vitae

Name: e.g. Robert Louis Stevenson; or Stevenson, Robert Louis; or STEVENSON,

Robert Louis.

Nationality: Always begin with a capital letter: French, German, Japanese, etc. You can also add Marital status: Single or Married.

Objective: e.g. A job in international marketing; A traineeship in trading; Marketing assistant; Account manager; Financial analyst.

Work experience: Give dates (month or years) and name of employer(s). Put the most recent first. Be specific about your duties if they have any relevance to a business career, e.g.

Summer 2002, Offece Assistant, Book Antiqua Ltd, Lucida, New jersey.

Education: List this in reverse order, e.g.

2001-2 Master’s Degree in International Management, Bigtown University, Bigtown (expected date of completion July 2002)

1998 – 2001 Degree in Business Administration, majoring in Finance/Marketing, etc. (sometimes called a Bachelor’s Degree)

An English translation of your institution might be Faculty or school of Business Administration and Economics.

Between 14 and 18 or 19 years old you probably attended what is translated as a High School or a Secondary School, where you probably obtained the equivalent of a High School Certificate. Your primary education is probably not important.

Computer skills: e.g.

Working knowledge of Microsoft Office, Word, Excel, Powerpoint, and internet software.

Languages: e.g.

French (mother tongue), good knowledge of German and English, elementary knowledge of Spanish. [Not ‘knowledgeS’ with an s.]

Or: Fluent in Spanish and English, some knowledge of French and Italian.

Hobbies and interests: e.g.Underwater skiing, synchronized sewing, deep-sea football, long-distance cooking, cross-country swimming…

It is preferable to list hobbies that demonstrate qualities that are relevant to the job you are seeking.

References [or Testimonials (US)]:

The names and address (and phone numbers, fax numbers or e-mail addresses) of two referees are often required.

Unit 6

BRANDS AND ADVERTISING

Text 1. Products and Brands

Marketing theorists tend to give the world product a very broad meaning, using it to refer to anything capable of satisfying a need or want. Thus services, activities, people(politicians, athletes, film stars),places(holiday resorts),organizations(hospitals, colleges, political parties),and ideas, as well as physical objects offered for sale by retailers, can be considered as products. Physical products can usually be augmented by benefits such as customer advice, delivery, credit facilities, a warranty or guarantee, maintenance, after-sales service, and so on.

Some manufactures use their name (the 'family name') for all their products, e.g. Philips, Colgate, Yamaha. Others, including Unilever and Procter & Gamble, market various products individual brand names, with result that many customers are unfamiliar with the name of the manufacturing company. The major producers of soap powders, for example, are famous for their multi-brand strategy which allows them to compete in various market segments, and to fill shelf space in shops, thereby leaving less room for competitors. It also gives them a greater chance of getting some of the custom of brand-switchers.

Most manufacturers produce a large number of products, often divided into product lines. Most product lines consists of several products, often distinguished by brand names, e.g. a range of soap powders, or of toothpastes. Several different items (different sizes or models) may share the same brand name. Together, a company's items, brands and products constitute its product mix. Since different products are always at different stages of their life cycles, with growing, stable or declining sales and profitability, and because markets, opportunities and resources are in constant evolution, companies are always looking to the future, and re-evaluating their product mix.

Companies whose objectives include high market share and market growth generally have long product lines, i.e. a large number of items. Companies whose objective is high profitability will have shorter lines, including only profitable items. Yet most product lines have a tendency to lengthen over time, as companies produce variations on existing items, or add additional items to cover further market segments. Additions to product lines can be the result of either line-stretching or line-filling. Line-stretching means lengthening a product line by moving either up-market or down-market, i.e. making items of higher or lower quality. This can be carried out in order to reach new costumers, to enter growing or more profitable market segments, to react to competitors' initiatives, and so on. Yet such moves may cause image problems: moving to the lower and of a market dilutes a company's image for quality, while a company at the bottom of a range may not convince dealers and customers that it can produce quality products for the high end. Line-filling-adding further items in that part of a product range which a line already covers-might be done in order to compete in competitors' niches, or simply to utilize excess production capacity.

Task 1. Answer the questions.

1. Why do the big soap powder producers have a multi-brand strategy?

2. Why do companies’ product mixes regularly change?

3. What factors influence the length of companies’ product lines?

4. What are the potential dangers of line-stretching?

5. Why might companies undertake line-filling?

Task 2

Find the place of words.

(1-Brand, 2-claim, 3-differentiation, 4-marketing, 5-nothing, 6-simplicity)

Maybe it because ____is intangible or perhaps ____is not about ____at all. So what is it? Brands is a ____ of distinction. It’s not simple, ____more, no labor definitions convoluted with part words in details. Think about the____, with out distinction you can’t have a____, and without ____you have commodity.

Text 2. Nokia - Building A Powerful Technology Brand

The world of parity has hit the mobile phone market just as it has many other technology product categories. The products range from the simple to the complex, but every manufacturer offers, of course, the latest features. Leapfrogging in sales between brands is frequently based on design. But overall the market is predictable, with Nokia, Motorola, and Ericsson fighting it out at the top and several less successful brands like Samsung, Philips, Siemens and Panasonic trying hard to make inroads into their top competitors' market share. So what makes the difference between the most successful and less successful brands? It certainly is not what product features are offered. How, then, do consumers choose? The answer seems to be what the brand names mean to them.

Nokia Group the Finland-based manufacturer of mobile phones, has been steadily working on its corporate brand name and the management of consumer perceptions over the last few years. Its efforts have paid off, because it is now the number one brand in many markets around the world, effectively dislodging Motorola from that position. The brand has been consistently well managed across all markets. Nokia has succeeded in lending personality to its products, without even giving them names. In other words, it has not created any sub-brands but has concentrated on the corporate brand, giving individual products a generic brand personality. Such is the strength of the corporate brand.

Nokia has succeeded where other big brand names have so far failed, chiefly by putting across the human face technology-taking and dominating the emotional high ground.

Nokia has detailed many personality characteristics for its brand, but employees do not have to remember every characteristic. They do, however, have to remember the overall impression of the list of attributes, as you would when thinking about someone you have met. As the focus is on customer relationships, the Nokia personality is like a trusted friend. Building friendship and trust is at the heart of the Nokia brand. And the human dimension created by the brand personality carries over into the positioning strategy for the brand.

When Nokia positions its brand in the crowded mobile phone marketplace, its message must clearly bring together the technology and human side of its offer in a powerful way. The specific message that is conveyed to consumers in every advertisement and market communication (though not necessarily in these words) is "Only Nokia Human Technology enables you to get more out of life".

In many cases, this is represented by the tag line, "We call this human technology". This gives consumers a sense of trust and consideration by the company, as though to say that Nokia understand what they want in life, and how it can help. And it knows that technology is really only an enabler so that you-the customer-can enjoy a better life.

Nokia is a great brand because it knows that the essence of the brand needs to be reflected in everything the company does, especially those that impact the consumer. Product design is clearly critical to the success of the brand, but how does Nokia manage to inject personality into product design? The answer is that it gives a great deal of thought to how the user of its phones will experience the brand, and how it can make that experience reflect its brand character. The large display screen, for example, is the "face" of the phone. Nokia designers describe it as the "eye into the soul of the product". The shape of phones is curvy and easy to hold. The faceplates and their different colors can be changed to fit the personality, lifestyle, and mood of the user. The soft key touch pads also add to the feeling of friendliness, expressing the brand personality. Product design focuses on the consumer and his needs, and is summed up in the slogan, "human technology."

Nokia achieved its brilliant feat through consistent branding, backed by first-class logistics and manufacturing, all of which revolve around what consumers what.

Task 1. Explain in English the following phrases:

1. to hit the mobile phone market;

2. leapfrogging in sales between brands;

3. to make inroads into;

4. efforts have paid off;

5. human technology.

Task 2. Make the sentences complete:

1. The overall mobile phone market is predictable… .

2. Nokia has succeeded where other big brand names have failed because … .

3. Nokia has detailed … .

4. When Nokia positions its brand in the crowded mobile phone marketplace … .

5. Nokia is a great brand because … .

Task 3. Say whether these statements are true or false:

1. There are a lot of mobile phones brands but only few of them are at the top of the market.

2. Brands become successful due to the superb product features offered to the consumer.

3. The strength of the corporate brand is to give an eye-catching name.

4. The product design that Nokia suggests focuses on the consumer and his needs.

5. Nokia’s strong point is that it’s pressing slogans and advertisements make people buy.

6. It’s not necessary for Nokia to clearly convey the message to the audience, the essence of the brand is felt in every detail of the product.

Task 4. Write an essay describing one of the famous world brands.

Task 5. Complete the text with the correct forms of the words:

Philips - Strengthening a Global Brand

Royal Philips Electronics - its proper name - is a giant company.

1. in 1891 is a lamp factory, it now has over 100 different ESTABLISH

business, over 200 production sites, and carries out research

and (2) in more than 40 countries. Its sales and service DEVELOP

outlets cover 150 countries, and it has a total workforce

upwards of 230,000 (3) . It has a strong technology base, EMPLOY

spending over 5% of sales on research and development,

and (4) some 10,000 patents. Its portfolio covers a wide OWN

(5) of product categories, including: VARY

semiconductors, TV, video, audio, (6) networks, DIGIT

lighting, medical systems, mobile phones, domestic appliances,

personal care products.

With main focus on health and well- being, the company (7) SERVE

professional and consumer markets through three overlapping

sectors: healthcare, lighting and consumer lifestyle. The innovation

(8) is demonstrated by translating customer insights into CAPABLE

(9) technology and (10) that improve the quality of people’s APPLY

lives.

Text 3. How famous brands were named.

Shakespeare once said, “What’s in a name?” Little did he know that we were about to enter the world of corporate business flooded with brands and logo designs. With the evolution of the concept of branding, everything sells with a name and a logo design. You don’t buy shoes, you buy Nike or Adidas. You no longer believe in drinking water, you prefer drinking Aquafina. You don’t eat a hamburger; you purchase one with a McDonald’s logo on its wrapper.

We are accustomed to guessing acronyms whenever we hear one. But later, it usually turns out it’s not what we thought of. Like CISCO does not stand for anything, it’s just derived from San Francisco. Sometimes, brands are named after weird things, but all have a history behind their etymology.

Guess what famous brands are described below:

1. The Accidental Name

Originally named “Backrub”, the company then was being changed. Its new name was a word for the number represented by 1 followed by 100 zeros. This name was spelt incorrectly as … and it stayed.

2. A Complex Name

This acronym has a very interesting history behind it. It is a combination of the first initials of Swedish founder Ingvar Kamprad plus the first letters of the names of the property and the village he grew up. This formed Ingvar Kamprad Elmtaryd Agunnaryd, abbreviated as … .

3. The Inspiration

The name and logo design have an interesting history connected with the fruit that provoked Newton into inventing gravity. Hence … stands for an inspiration for constant invention and development.

4. Not What We Think

Though many of us attribute the meaning of this brand to the abbreviation of “All Day I Dream About Sports” the name is actually derived from the name of the founder Adolf (Adi) Dassler.

5. The Ingredients

One of the strongest brands’ names in the world is derived from the coca leaves and kola nuts used as flavouring. … maker John S. Pemberton altered the ‘K’ of kola to ‘C’ to make the name resonant and consonant.

6. Sign of Victory

The company has adopted its name from the Greek goddess of victory. No wonder a ‘swoosh’ was happily accepted by … , as it accurately signals a sign of victory.

7. Daddy’s Little Girl

The famous car brand was originally named after Emil Jellineks’ daughter, Mercédès Jellinek. Emil Jellineks was the man behind the engine designed by Wilhelm Maybach and Gottlieb Daimler and officially had his daughter’s name on it. … was actually his daughter’s nickname.

8. The Lucky Charm

Although the name was derived from the founder’s name Sakichi Toyoda, it was changed via a logo design contest for a resonantly sounding name. The new name was imprinted in eight Japanese letters, a number that is believed to be lucky in Japan.

Text 4. How companies advertise

    Advertising informs consumers about the existence and benefits of products and services, and attempts to persuade them to buy them. The best form of advertising is probably word-of-mouth advertising, which occurs when people tell their friends about the benefits of products or services that they have purchased. Yet virtually no providers of goods or services rely on this alone, but use paid advertising instead. Indeed, many organizations also use institutional or prestige advertising, which is designed to build up their reputation rather than to sell particular products.

    Although large companies could easily set up their own advertising departments, write their own advertisements, and buy media space themselves, they tend to use the services of large advertising agencies. They are likely to have more resources, and more knowledge about all aspects of advertising and advertising media than a single company. The most talented advertising people generally prefer to work for agencies rather than individual companies as this gives them the chances to work on a variety of advertising accounts(contracts to advertise products or services). It is also easier for a dissatisfied company to give its account to another agency than it would be to fire its own advertising staff.

    The client company generally gives the advertising agency an agreed budget; a statement of the objectives of the advertising campaign, known as a brief; and an overall advertising strategy concerning the message to be communicated to the target costumers. The agency creates advertisements (the word is often abbreviated to adverts or ads ), and develops a media plan specifying which media-newspapers, magazines, radio, television, cinema, posters, mail, etc-will be used and in which proportions. (On television and radio, ads are often known as commercials.)Agencies often produce alternative ads or commercials that are pre-tested in newspapers, television stations, etc. in different parts of a country before a final choice is made prior to a national campaign.

   The agency's media planners have to decide what percentage of the target market they want to reach(how many people will be exposed to the ads) and the number of times they are likely to see them. Advertising people talk about frequency or 'OTS' (opportunities to see) and the threshold effect - the point at which advertising becomes effective. The choice of advertising media is generally strongly influenced by the comparative cost of reaching 1,000 members of the target audience the cost per thousand (often abbreviated to CPM, using the Roman numeral for 1,000). The timing of advertising campaigns depends on factors such as purchasing frequency and buyer turnover (new buyers entering the market).

     How much to spend on advertising is always problematic. Some companies use the

comparative-parity method - they simply match their competitors' spending, thereby avoiding advertising wars. Others set their ad budget at a certain percentage of current sales revenue. But both these methods disregard the fact that increased ad spending or counter-cyclical advertising can increase current sales. On the other hand, excessive advertising is counter-productive because after too many exposures people tend to stop noticing ads, or begin to find them irritating. And once the most promising prospective customers have been reached, there are diminishing returns, i.e. an ever-smaller increase in sales in relation to increased advertising spending.

Task 1.Find the terms in the text which mean the following:

1. free advertising, when satisfied customers recommend products to their friends.

2. advertising that mentions a company’s name but not specific products

3. companies that handle advertising for clients

4. a contract with a company to produce its advertising

5. the amount of money a company plans to spend in developing its advertising and buying media time or space

6. the statement of objectives of an advertising campaign that a client works out with an advertising agency

7. the advertising of a particular product or service during a particular period of time

8. a defined set of customers whose needs a company plans to satisfy

9. the people who choose where to advertise, in order to reach the right customers

10 . the fact that a certain amount of advertising is necessary to attract a prospective customer’s attention

11. choosing to spend the same amount on advertising as one’s competitors

12. advertising during periods or seasons when sales are normally relatively poor

Task 2. Match a proper definition:

1. Article A) selling of goods in large quantities to shopkeepers for resale

2. bargain B) activity in which persons compete

3. brand C) a person who buys goods

4. wholesaling D) a table or a flat surface on which goods are shown

5. check out E) stock or amount of something which is obtainable

6. commercial F) agreement to buy or sell or something, made after a discussion

7. custom-made G) a trademark

8. competition H) an item

9. counter I) people’s desire to buy

10. customer J) an advertisement

11. demand K) a place in a supermarket where one pays the bill

12. discount L) money which can be taken off the full price

13. supply M) special order

Task 3. Match to make sentences:

1. I can’t believe they charged me….. a) about the economy

2. The old lady begged me…… b) that I pay back my loan immediately

3. I’ll never forget…… c) learning that I had the winning ticket

4. My dad and my uncle always argue…… d) to the girl at the desk and left.

5. I was shocked when the bank demanded…e) for using the hotel pool.

6. We really can’t afford…. f) to buy a new fridge.

7. Debra paid the money….. g) to give her some money.

Unit 7

CORPORATE CULTURE

Text 1. Corporate culture of an organization

Every business – in fact every organization – has a culture. Sometimes it is fragmented and difficult to read from the outside, sometimes the culture of an organization is very strong: everyone knows the goals of the corporation, and they are working for them. Whether weak or strong, culture has a powerful influence throughout an organization. It affects practically everything – from who gets promoted and what decisions are made, to how employees dress and what sports they play. Because of this impact, we think that culture also has a major effect on the success of a business.

People at all stages of their careers need to understand culture and how it works because it will likely affect their lives. People starting their careers may think a job is just a job. But when they choose a company, they often choose a way of life. The culture shapes their responses in a strong but subtle way. Culture can make them fast or slow workers, tough or friendly managers, team players or individuals. By the time they’ve worked for several years, they may be so well conditioned by the culture they may not even recognize it. But when they change jobs, they may be in for a big surprise.

For example, Xerox has a totally different culture than General Electric. Success at Xerox is closely tied to an ability to maintain a near frenetic pace, the ability to work and play hard – Xerox-style. By contrast, GE has a more thoughtful and slow-moving culture. Success at GE is a function of being able to take work seriously, a strong sense of peer group respect and a sense of deliberateness. A person of proven success at GE will bring these values to Xerox because past experience of GE’s culture has reinforced them. But these same values may not be held in high esteem elsewhere. Bright young comers at GE could quickly fail at Xerox – and not even understand why. Their deliberate approach to issues will be seen by insiders at Xerox as a sign that they ‘lack smarts’.

Thus at the heart of corporate culture are ‘shared values’ which provide a sense of common direction for all employees and guidelines for their day-to-day behavior and with which all the staff can be identified: being the best hotel chain or making the best, the safest, the most ecological and reliable products, for example. Companies often succeed because their employees can identify, embrace and act on the values of an organization.

Types of corporate culture

Corporate culture of an organization is created by a number of things. It’s created by people who work for this organization. It’s created by the kind of management systems which exist in an organization, and quite often it’s created by the style of the company’s leader.

An organization which exhibits a very bureaucratic culture would have quite strict systems of control. There would be a lot of management systems to control people; there would be a lot of company directives, a lot of company rules. The senior managers would be fairly autocratic, probably respected by their subordinates in the company, and generally the company would be run along very strict and rigid lines.

In a company which exhibits a facilitating culture, which is the culture whereby employees are empowered to do their jobs, responsibility is devolved, people are encouraged to express themselves, to work in different ways, to get things done in their own way, rather than the way in which the boss says. One would associate that kind of organization with much looser control systems. Senior managers would probably tend to be much more relaxed, far less autocratic and possibly fairly charismatic characters, who have the confidence to devolve responsibility to their subordinates, respected for themselves rather than for the position of authority that they hold within that company.

When anyone starts a new job, they have to learn the ways in which things are done in the new organization that they’ve entered. So it’s a traumatic process for anybody, even if the organization is similar to the last one you worked for. In most cases people will adapt over a period of time. People will adapt to the new way of working either by peer pressure conforming to the way their peers within the organization are working or because the employer has recognized there’s a problem and maybe has given them some additional training to enable them to cope with the new system of working.

One of the most important things is to create the kind of corporate culture you feel comfortable to perform – that means creating a high productivity culture. Corporate culture is changing the attitudes of your employees. It’s obviously the most powerful motivating tool that a company can have because the company’s culture can encourage employees to relate their own personal goals of working to the organizational goals, so that by achieving your personal goals, you’re going some way to achieving your organizational goals. The best way that a company can do that is to identify themselves as an employer who cares about developing their subordinates and encourages personal development and personal growth so that people are getting something out of work other than just a living wage, things like promotion, recognition, responsibility and a demanding position.