IX. Make up your own dialogue using the following words, expressions and words-combinations:

quantity of goods and services market economy

rationing effect of price auctioneer

to offer items for sale elasticity

to attend an auction bidder

X. Refer the following statements to the past:

Model: Economic incentives influence our decision about

what and where to buy.

Economic incentives influenced our decision about

what and where to buy. 1. What you see at the auction is the rationing effect of prices. 2. Prices encourage producers to increase their level of output. 3. The law of demand describes the relation­ship between prices and the quantity of goods and services.

4. They sell these goods because they want to have a profit from such transaction. 5. Adam Smith describes the principal elements of the economic system in his book «The Wealth of Nations».

XI. Ask questions to which the following statements are answers:

Model: This work seemed easy. Did this work seem easy? 1. The development of modern economics began in the 17th century. 2. Large corporations used economists to study the way to do business. 3. Peter received his first paycheck of $135 yesterday. 4. I went into business last year. 5. First of all we decided to learn the demand of our consumers.

XII. Translate into English:

1. l^loMy 6yno Henemo po3nonaTn Bnacny cnpaBy. 2. Zmhm nonmy ra npono3nu,ff BnnHHynM Ha pmmkobJ ujhm. 3. Llinn BnnM-HyjiM na 3MeHweHHfl piBHfi BwnyCKy roaapiB. 4. flnn Toro mo6 bmbhmtm nonm cnoKMBaniB, mm npoBenn HH3Ky cnocTepemeHb.

5. Mm nepernflhynM pe3ynbtaTM cnociepe>KeHb i 3po6nnn flna ce6e neBHi bmchobkm.

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XIII. Communicative situations:

1.lf you owned an ice-cream shop at a seaside resort and additional ice-cream shops were opening in your area because of increasing prices, how would you take advantage of the use of substitute products to compete more effectively? How would you make use of the concept of demand elasticity in making decisions whether or not to raise your prices for your specially items such as shakes, sundaes, and banana splits?

2. When the forces of supply and demand are at work in a market economy, the equilibrium price is the only one that matters. All other prices are irrelevant (beside the point).

Explain this statement.

3. The law of demand works because consumers have the ability to substitute. The law of supply works because producers have the ability to substitute.

Explain these statements.

Lesson 4 THE CONSUMER IN OUR ECONOMY

I. Read and memorize the following words, word-combinations and word-groups:

to meet one's needs — 3aflOBonbHjiTw noTpe6n

e.g. Many businesses work very hard to meet your needs and wants.

wage(s) (syn. salary) — 3apo6rma nnaTa

e.g. In return for working, you will receive a wage or salary.

wealth — 6araTCTBo

e.g. Wealth is the value of the things you own. ^: to deposit money in a savings accout — miac™ rpowi Ha omaflHMfi paxyHOK

e.g. We decided to deposit money in a savings account. *-, to earn interest — OAep>«yBaTM bIacotkh

to loan — no3MHaTH, AaBa™ no3HKy

e.g. Wealth, in the form of money that is loaned to others or deposited in a savings account, will earn interest.

expenditures — BiiTparw

savings — 3aomaA>KeHHa

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e.g. The Greens plan their expenditures and savings very

carefully.

to make one's decision — npMMMa™ piweHHH

e.g. When the time comes to make a major purchase, we compare products and prices before making our decision.

to keep track — AOTpHMyeaTHca Kypcy

e.g. Most of the time, we are able to keep track of our expenditures (the money spent), so that we are able to meet our immediate needs.

to exceed — nepeBiiinyBayw

surplus — J1MUJOK

e.g. Budgets in which income exceeds expenditures will have a surplus.

rate of return — HopMa npn6yTKy

e.g. The rate of return is expressed as a percentage of the amount on deposit for a period of a year.

compound interest — cnnaAHi bjacotkh

e.g. Most accounts offer compound interest.

yield — npn6yTOK

e.g. It is important to distinguish between rate of return and yield, the actual amount of interest earned.

to share risk — po3noflinflTM cipaxoey cyMy

e.g. Insurance enables people to share risk.

endowment insurance — crpaxyBaHHs-BKnaA ' e.g. Endowment insurance protects the insured for a specific number of years.

consumer credit — cno>KMBVMii Kpeflm

e.g. Consumer credit provides cash, goods, or services now, while spreading repayment into the future.

finance charge — cfjiHaHcosi BwpaTM

e.g. Finance charge is the total amount you pay to use credit.

passbook loan — Knw>KKa 3aMMy

e.g. If you have a savings account, you may to apply for a passbook loan against your balance in that account.