6) Complete the summary,
Th<> Profit and T oss Account
A profit and loss account is
and
if the company is
A profit and loss account tells shareholders Information for Managers
Turnover shows managers
Operating profit shows This tells managers Information for Shareholders
7) Work in pairs and discuss.
1, .Are companies in Ukraine required to publish their financial results? Do you think this is good practice or not?
2 Do vou own anv shares in a company? Which companies in Ukraine offer a safe investment to shareholders.
Arc interest rates high or low in Ukraine'/ Is this good for investors? Is it good tor the economy '
Who sets interest rates in Ukraine? "Gov ernment or the Central Bank
?MONEY
Money is used for buying and selling goods, for measuring value and for . storing wealth. Almost every society has a money economy based on coins and paper bills of one kind or another. Checks and credit cards are being used increasingly.
Economists use the term purchasing power or value to describe the quantity of
goods, and services we can buy with our money. When prices increase, our money cannot bnj- ns much Tts purchasing power declines. An extend period of raising is called inflation. Inflation affects people differently: some suffer, some benefit. It hurts people living on fixed incomes and people who saved fixed amount of money for their retirement or for "a rainy day". The most familiar forms of inflation are a) demand-pulled inflation (demand is pulling up the price level), b) cost-push inflation (the cost of goods and services increases and the producers have to raise prices), c) hyperinflation (when economic activity is severely disrupted).
Real income is always affected by changes in consumer prices. To maintain the real wages or salaries in an inflationary period helps a cost-of-living adjustment This means adjustment of nominal income to the rate of inflation. The adj ustment is onlv partial and seldom protects fullv against inflation.
i 1 u.tvu^^u
thinking, good luck, sense of timing, courage, determination and firm grip, good advice, caution, long-term investment, investing at the time of maximum pessimism '
(in other words, moving against current investment fashions) can make you a successful investor.
Some words and phrases are associated with success and with failure in business. Success: boom, growth, expansion, golden age. bull market (a situation in which a lot of people are buying stocks if they expect prices to nse). Failure: crash decline siump, recession, bear market ta situation in which uie value of stocks is decreasing).
These 4 verbs describe four common activities on the financial market:
to hedge- try to protect yourself against possible financial loss (never put all money in the same place)
to invest - to give money to a company, business or bank in order to get a profit back.
J) i<j jpucuituc- u - itiiM. i ii^. i iaiw.
4) to deal- to want a quick profit (to buy and sell).
A person who buys an unsuccessful company, sells its most valuable parts and then closes it down is called asset stripper.
Speaking about money we always mention shares and currencies. I. Currencies: exchange rate, EMU, sport rate, sterling, yen etc.
exchange rate - the rate at which the money of one country is exchanged for that of another.
EMU - European Monitory Union. It is the planned system for one economic plan and the same money for all members of the EC.
sport rate - the exchange rate for telegraphic transfers.
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