An  introduction  to  economics

TOPIC 1.

Study carefully the meaning of the following phrases and word combinations to avoid any difficulty in understanding the following text.

 

household – дом, хозяйство

account – счет

to take into account – брать в расчет

to allocate – размещать, распределять

scarce – недостаточный, скудный

scarcity – дефицит

to satisfy unlimited wants – удовлетворять  неограниченные потребности

goods and services – товары и услуги

commodity - товар, предмет широкого потребления

resource – запасы, ресурсы, средства; природные богатства

to invest – вкладывать

investment – вложение

income – доход

national income – национальный доход

personal income – личный доход

personal disposable income - личный доход после уплаты налогов

facet – аспект

to recur – повторяться, возвращаться

fraction - доля, порция, часть

total production – общая производительность

total employment – общая занятость

the rate of change of overall prices – коэффициент изменений предельных цен

rate of economic growth – темпы экономического роста

layoff – увольнение

economic activity – экономическая активность

determinants – показатели, определители

values – ценности

meaningful totals – значительные итоги

gross domestic product (GDP) – валовой внутренний продукт (ВВП)

attainment – достижения

price stability – стабильность цен

 

COMPREHENSION CHECK

I. Give English equivalents to the following:

Экономика, экономическая теория, производство, потребление, распределение, обмен, дефицит, доход, уровень жизни, изучение поведения в сферах производства, физические лица, ограниченность ресурсов, безграничные потребности, удовлетворение своих желаний и потребностей, предмет экономической теории, малые экономические единицы, крупномасштабные экономические явления, экономический анализ, занятость населения, товары и услуги, национальный доход, стабильность, оптимизация, нехватка рабочей силы.

 

II. Read the international words and guess their meanings:

Economic activity, economic system, macroeconomics, microeconomics, to produce, to operate, to protect, to analyze, to finance, to manufacture, to specialize, to focus, to affect, service, school, hospital, garage, fact, base, production, material, industry, radio, strategy, status, export, import, institution, distribution, division, investment, history, organization, period, spectrum, agriculture, essential, basic, industrialized, oriented (policy), national, financial, social, major, fact, base, total, primarily, public.

 

III. Are the following statements true or false?

1. There is no brief description of the content and character of economics.

2. Economics is only a theoretical science.

3. Economics deals with the problem of income, employment and interest rates.

4. Economics also deals with weather forecasting, psychology and fantasy writing.

5. In recent years economists switched to the new fields, such as political science and sociology.

6. Macroeconomics deals with global questions only.

7. Macroeconomics means economics in the large because it asks more questions than microeconomics.

8. Macroeconomist analyses activities of families and large firms.

9. Such concepts as gross domestic product, national income and personal disposable income serve as meaningful totals.

10. Macroeconomic analysis shows the development of the economic theory.

 

IV. Fill in the gaps using the words given:

Scarcity, income, interact, society, trends, management, economics, economy

1) The word ______ comes from the Greek word for "one who manages a household.''

2) Like a household, a _____ faces many decisions.

3) The _____ of society's resources is important because resources are scarce.

4) _____ means that society has less to offer than people wish to have.

5) _____ is the study of how society manages its scarce resources.

6) Economists also study how people _____ with one another.

7) Economists analyze forces and _____ that affect the economy as a whole, including the growth in average _____, the fraction of the population that cannot find work, and the rate at which prices are rising.

 

V. Translate into English

1. Мировая экономика – это наука, которая изучает состояние экономики в разных странах мира.

2. Экономика - общественная наука, изучающая поведение в сферах производства, потребления, распределения и обмена. Экономисты анализируют происходящие в этих сферах процессы и исследуют их последствия для физических лиц, организаций, например фирм, и общества в целом.

3. Состояние экономики (экономической среды) имеет большое значение для успешной деятельности фирм.

4. При изучении экономики необходимо различать позитивную и нормативную экономические теории. Если в позитивной теории мы можем оставаться беспристрастными, независимо от наших политических убеждений, то нормативная теория основывается на личной системе ценностей.

5. Позитивная теория может предложить ряд возможных альтернатив, из которых индивид или общество в целом выбирают наиболее приоритетные.

6. Макроэкономика – это один из основных разделов экономической теории, которая изучает поведение экономики как единого целого.

7. Макроэкономика анализирует взаимодействие факторов, влияющих на рост национального производства, а также такие процессы, как безработица, инфляция и т.п.

8. Объектом макроэкономики является именно взаимодействие этих величин внутри экономики, при этом сами эти величины рассматриваются упрощенно, абстрактно.

9. Микроэкономика – это один из основных разделов экономической теории, изучающей поведение отдельных экономических единиц, их взаимодействие на рынках, в результате которого формируются цены на производимые товары и услуги.

10. Микроэкономика стремится к детальному рассмотрению поведения какой-либо экономической единицы.

 

VI. Answer the questions

1. What is economics?

2. What is it based upon?

3. What two things do economists study?

4. What does the economist try to describe?

5. What should the economist’s methods be?

6. What is the science of Economics concerned with?

7. What is an underlying problem of Economics?

8. What does the word ‘macroeconomics’ mean?

9. What are the concerns of a macroeconomist?

10. What is difference between the question asked by macroeconomists and micro economists?

11. What is, according to the text, the important task of macroeconomics?

12. What does macroeconomic analysis attempt to explain?

13. What are the concepts of macroeconomics?

14. What is according to the text microeconomics?

15. What is meant by “economics in the small”?

16. What economic phenomena are of microeconomists’ attention?

17. Where is microeconomic theory used?

18. What does the positive economics deal with?

19. What is the aim of normative economics?

20. What is the difference between positive and normative economics in regard to the role of research?

 

 

Литература

Основная: 1, 5, 6.

Дополнительная: 2, 3,4,5.

TOPIC 2.

THE BASIC ECONOMIC PROBLEM

The central problem of economics is to determine the most efficient ways to allocate the factors of production and solve the problem of scarcity created by society’s unlimited wants and limited resources. In doing so, every society must provide answers to the following three questions:

1. What goods and services are to be produced, and in what quantities are they to be produced?

2. How are those goods and services to be produced?

3. Who will receive and consume (get to use) those goods and services?

The solution of these questions depends on the economic system of each particular society.

The economic system determines how the nation's resources of land, labour, machinery and raw materials are allocated and used. The problem of allocating resources is a central theme of economics, because most resources are scarce. The allocation of scarce resources and the distribution of the product of those resources are a major part of the subject matter of economics.

In Western economies many resources are allocated to whoever is willing and able to pay the most for them. The distribution is determined by the amounts of money paid as wages, rent and other forms of income.

A country's economic system is its way of organizing economic activities, including the ways in which people come to specialize in particular tasks they do best. The more goods and services can be produced from limited resources, the higher the standard of living enjoyed by the country’s citizens.

Different economic systems answer the “what”, “how” and “for whom” questions differently. There is a variety of economic systems, which can be divided into three groups:

a) Market or decentralized economic systems.

In a true market economy the government plays no role in the management of the economy, the government does not intervene in it. The system is based on private enterprise with private ownership of the means of production and private supplies of capital.

b) Planned or centralized economic systems, in which economic decisions are taken by government planners.

Planned economies are economies with a large amount of central planning and direction, when the government takes all the decisions, the government decides production and consumption. A planned economy is simple to understand but not simple to operate.

c) Mixed economic systems, in which many economic activities are organized in a decentralized way, but in which the government takes some of the most important economic decisions. In mixed economies some resources are controlled by the government whilst others are used in response to the demands of consumers. In a mixed economy the government and the private sector interact in solving economic problems.

In practice, every economic system is mixed to some extent.

COMPREHENSION CHECK

 

I. Give English equivalents to the following:

Распределять ресурсы, удовлетворять неограниченные потребности, владеть и управлять бизнесом, вмешиваться, частное предпринимательство, частная собственность на средства производства, частный капитал, распределение доходов, правительственные власти, основные экономические проблемы, состояние экономики, уровень занятости, распределять ресурсы, имеющиеся в распоряжении ресурсы, иметь высокий жизненный уровень, факторы производства, зависеть от, размещение и распределение ресурсов, быть конкурентоспособным, большой объем, центральное планирование и руководство, частный сектор, взаимодействовать в решении проблем.  

II. Read the words and guess their meanings:

Factors of production, production and consumption, natural resources, capital and entrepreneurship, competitive, state ownership, public property/common ownership, large-scale intervention, state-controlled industry, considerable economic freedom of choice, the government controls a share of the output, labour-intensive production, to allocate the factors of production, the problem of allocating resources, the subject matter of economics, money paid as wages, rent and other forms of income, to specialize in particular tasks, the standard of living, in a decentralized way, in response to the demands of consumers, in solving economic problems.  

TOPIC 3.

FACTORS OF PRODUCTION

In economic theory, factors of production (or productive inputs) are the resources employed to produce goods and services. The factors of production include natural resources, human resources, capital and entrepreneurship. Each factor of production has a place in economic system, and each has a particular function. People who own or use a factor of production are expecting a “return or reward”. This generates income which, as it is spent, becomes a kind of fuel that drives the economy.                                   

Natural Resources or «Land»

Natural resources are the things provided by nature that go into the creation of goods and services. They include such things as minerals, wildlife and timber resources. Economists also use the term «land» when they speak of natural resources as a factor of production. The price paid for the use of land is called rent. Rent becomes income to the owner of the land.

Human Resources or «Labor»

Economists call the physical and mental effort that people put into the creation of goods and services labor. The price paid for the use of labor is called wages. Wages represent income to workers, who own their labor. Human labour produces both goods and services. The national labour force are those people who are available for work within the nation, i.e. the working population.

Capital

To the economist, physical capital (or «capital» as it is commonly called) is something created by people to produce other goods and services. A factory, tools and machines are capital resources because they can be used to produce other goods and services. The term capital is often used by business people to refer to money they can use to buy factories, machinery and other similar productive resources. Payment for the use of someone else's money, or capital, is called interest. But money, as such, produces nothing: hence, it is not to be considered as an economic resource. Real capital — tools, machinery, and other productive equipment - is an economic resource; money or financial capital is not. The process of producing and accumulating capital goods is known as investment.

Entrepreneurship

Closely associated with labor is the concept of entrepreneurship, the managerial or organizational skills needed by most firms to produce goods and services. The entrepreneur brings together the other three factors of production. When they are successful, entrepreneurs earn profits. When they are not successful, they suffer losses. The reward to entrepreneurs for the risks, innovative ideas and efforts that they have put into the business, they obtain the money that remains after the owners of land, labor and capital have received their payments.

COMPREHENSION CHECK

 

 

I. Give Russian equivalents to the following:

А means of exchange, a means of measuring, in return for a fixed payment, in the strict economic sense, financial reward, in terms of money, human labour, distinctions of social class, payment of wages, national labour force, it should be noted, self-employed, fixed wage, to receive surplus, reward of private enterprise, a negotiated rate, a result of productive work, to share the surplus, to pay for, other items, to bear risk, the risk has been justified, as a return on the investment, previous business activities, a deliberate policy of saving surpluses, to create capital, the assets possessed   by a person.

 

 

II. Give English equivalents to the following:

Производительные силы, производственные отношения, производство материальных благ, оказывать воздействие, взаимосвязь производительных сил и производственных отношений, форма собственности на средства производства, формы распределения материальных благ, жизненные интересы, взаимоотношения людей, способность человека к труду, количество и качество, квалифицированная рабочая сила, создавать прибавочную стоимость, постоянный капитал, переменный капитал, оборотный капитал, готовый продукт.

 

 

III. Make sentences by adding a suitable beginning to the following:

1. …. but with the payment of wages in return of work.

2. ….. is not labour in the strict economic sense.

3. ……is known as profit.

4. ……in return for a fixed payment.

5. ……the working population.

6. ……also a means of measuring the value of men’s labour.

 

 

IV. Agree or disagree with the following statements:

1. There is always an element of risk in starting a business.

2. If the business is not successful, the risk has been justified.

3. All railways, houses, land, airports shares are capital.

4. Profit is the surplus which accumulates as a result of productive work.

5. The employees, the employers and the providers of capital bear the risk.

6. A deliberate policy of saving surpluses may be only collective.

7. The employer obtains the surplus after he pays the wages of his employees.

 

VI. Translate into English

1. Для удобства производительные ресурсы обычно делят на четыре основные категории, которые называются факторами производства.

2. Труд — деятельность людей, направленная на удовлетворение потребностей индивида и общества.

3. Как экономическая категория, труд представляет собой один из факторов производства.

4. Процесс труда включает в себя три основных фактора:
- целесообразную деятельность человека;
- предмет, на который направлен труд;
- средства труда, с помощью которых человек воздействует на предмет труда.

5. Капитал — это совокупность отношений и предметов, выраженных в виде стоимости, способной приносить прибавочную стоимость или убыток.

6. Капитал включает в себя все те производительные ресурсы, которые созданы людьми: инструменты, машины, инфраструктуру, а также нематериальные вещи, например, компьютерные программы.

7. Распределение любого данного количества блага может быть улучшено посредством обмена.

8. Предпринимательская способность - в экономической науке - способность человека:
- использовать определенное сочетание ресурсов для производства товара;
- принимать разумные последовательные решения;
- применять новшества; и
- идти на (оправданный) риск.

9. Предпринимательством можно заниматься в разных сферах. Помимо общего предпринимательства, выделяют социальное и технологическое предпринимательство.

10. Земля - один из четырех основных факторов производства, который для того, чтобы стать производительным, обычно должен соединяться с трудом и капиталом.

 

VII. Answer some questions:

1. What are the factors of production?

2. What is the fuel that drives the economy?

3. What are the natural resources?

4. What, in economic theory, is “labour”?

5. What is called “the price paid for the use of labour”?

6. Why is necessary to treat labour somewhat differently from the other factors of production?

7. How may be the working population be defined?

8. What is the capital?

9. How is capital created?

10. What is the role of entrepreneurship in production?

Литература

Основная: 1, 3, 5.

Дополнительная: 2, 3, 7.

TOPIC 4.

TYPES OF BUSINESS.

TYPES OF BUSINESS ORGANIZATION

 

WHAT IS BUSINESS?

Business is a word that is commonly used in many different languages. But exactly what does it mean? The concepts and activities of business have increased in modern times. Traditionally, business simply meant exchange or trade for things people wanted or needed. Today it has a more technical definition. One definition of business is the production, distribution, and sale of goods and services for a profit. Profit is the money that remains after all the expenses are paid. Creating an economic surplus or profit is, therefore, a primary goal of business activity.

 

STARTING A BUSINESS

Starting a business it is necessary to provide capital needed for this business. There is always an element of risk because this business may fail. If the business is successful, the risk-taking has been stifled and invested capital earns part of the profits as a return on the investment and the period during which the capital was at risk.

Capital in this instance is simply the accumulation of previous surpluses on previous business activities. It this way the past is used to finance the future. The accumulation of capital is almost always deliberate, either on the part of individual citizens or on the part of the state. Even in non-capitalistic societies a certain part of the surplus achieved in any enterprise is "ploughed back" into the system in order to promote further growth.

When capital, labour and enterprise combine to make a new business successful, the business must still continue to compete on the market with other companies producing the same type of commodity. The term "market", as used by economists, is a logical extension from the idea of a place set aside for buying and selling. Formally, part of a town was kept as a marketplace, and country people would come in on market days to buy and sell. Markets today need not however be located in any fixed places the sugar market and the cotton market are not geographical locations, but simply sets of conditions which permit buyers and sellers to work together.

In a free market, competition takes place among sellers in order to sell their commodities at the best possible price, and among buyers competition influences prices. Changes in supply and demand have their effects, and it is not surprising that considerable fluctuations in price can take place over periods of weeks and months. Since these modern markets are not normally located in any special place, buyers and sellers do not always have to meet face-to-face. They may communicate by letter, lay cable, by telephone or through their agents. In a perfect market such communications are easy, buyers and sellers are numerous, the competition

TYPES OF BUSINESS

The different types of business organization to be found in the UK and most other capitalist countries may be classified under five headings: the sole proprietor, the partnership, the joint stock company, the cooperative society, and the public corporation.

 

Types of organization	Legal form	Ownership	Sources of finance	Liability	Who runs the business
Sole trader	Little or no legal form	The proprietor	Personal savings, bank loan	Unlimited	The owner
Partnership	Partnership Act 1890, written agreement among partners	2–20 partners	Capital provided by partners	Unlimited, although some partners can have limited liability	The partners
Private Limited Company (LTD)	Registered under Companies Act 1985	Shareholders 2 or more (no maximum)	Issuing shares (restrictions On selling them), bank loan	Limited	The board of directions. Although the day to day running is done by the directors. Directors are elected by shareholders
Public Limited Company (PLC)	Registered under Companies Act 1985	Shareholders 2 or more (no maximum)	Issuing shares (can be freely sold), bank loan	Limited
Nationalised Industry	Act of Parliament	State owned	Government assistance	Limited	Board of directors appointed by the government
Co-operative	Industrial and Provident Societies Acts	Owned by members, whether the customers or workers	Shares,.1 each with an upper limit of .10 000	Limited	Management Committee elected by the members

Sole Trader

Advantages	Disadvantages
1. Only a relatively small amount of capital is needed to start up the business. 2. The owner works for him or herself.   3. Decisions can be taken quickly.   4. Profits are not shared.	1. Unlimited liability – could lose everything. 2. If the owner dies or is ill, hard to continue the business. 3. Difficult to obtain extra capital for expansion. 4. May lack ideas, as less people to ask.

Partnership

Advantages	Disadvantages
1. More capital available 2. Each partner can specialise on a particular task. 3. Range of ideas available.     4. Partners can share any losses (and profits!) 5. Accounts need not be published.	1. Unlimited liability 2. Action of one partner binding on others 3. May be problem of continuity on the death of a partner or if disagreement among partners 4. Capital may still be difficult to raise

 

Private Limited Company

Advantages	Disadvantages
1. limited liability   2. Still more capital available as more owners (shareholders)   3. Company has its own legal identity so can continue beyond a death or disagreement 4. Accounts need only be published in brief form	1. Less control for owners than in sole trader/ partnership 2. Capital less easy to raise than in public limited company as shares cannot be sold to general public

 

Public Limited Company

Advantages	Disadvantages
1. Limited liability 2. Easier to raise capital as shares can be sold to the general public 3. These firms can often grow very large, bene-fiting from economies of scale	1. Large firms may suffer from diseconomies of scale 2. Easy transfer of shares makes takeover bids possible 3. Full accounts must be published

THE SOLE PROPRIETOR

This is the simplest and the oldest form of business enterprise and often referred to as the one-person business. A single person provides the capital, takes the decisions, and assumes the risks. He or she is solely responsible for the success or failure of the business and has, therefore, the sole rights to such profits as may be made, or, alternatively, bears the sole responsibility for such losses as may accrue. The strength of this type of firm lies in the direct personal interest of the proprietor in the efficiency of his enterprise. Ownership and control are vested in one person who enjoys all the fruits of success and hence has a great incentive to run the firm efficiency. The great disadvantage of the sole proprietor from an enterprise lies in the fact that the owner is personally liable for the debts incurred by his firm and his liability is unlimited. All his personal possessions are at risk and may be seized to meet creditors demands in the event of the business becoming insolvent. Another disadvantage of this type of firm is the strict limitation of its ability to acquire capital for expansion. Finance is restricted to the amounts which the entrepreneur is able to provide from his own resources and whatever sums he can borrow on his own security. We find the one-person business prevalent in farming, retailing, building, repair and maintenance work, and personal services such as hairdressing.

general partner – общий партнер (несущий полную юридическую ответственность за дело);

silent partner – партнер без права голоса;

secret partner – секретный партнер (с правом голоса, но неизвестный общественности как партнер);

apply for a corporate charter – подавать заявление на корпоративный патент;

company's officers – административные исполнители компании;

sue – возбуждать судебное дело;

profit and loss statement – отчет о прибылях и убытках;

net assets – нетто-капитал, стоимость имущества за вычетом обязательств;

long-term investment – долгосрочный вклад;

be on commission – получать комиссионные с продажи;

verbal agreement – устное соглашение;

purchase order – заказ на покупку;

extra services – дополнительные услуги;

new brand – новая марка (товара);

installation services – услуги по установке;

take title to the goods – приобретать товар как собственность;

agent middleman – посредник между производителем и покупателем.

PARTNERSHIPS

Partnerships are voluntary combinations of from 2 to 20 persons formed for the purpose of carrying on business with a view of profit. A person who joins a partnership, supplying capital and sharing in the profits, but taking no part in the management is known as a dormant or sleeping partner. Partnerships are a common form of business organization in such professions as law, accountancy, surveying, and medicine. The advantages of this type of firm are similar to those of the one-person business; it is a flexible organization which allows a greater degree of specialization than the one-person business. Partners usually specialize in one or more aspects of the business; one may be responsible for buying, one for selling, one for production, and so on. The great disadvantage, like that of the one-person business, is the fact that the liability of the partners is unlimited and they are all fully liable for the acts of the other partners. The survival of partnerships depends upon the continued harmonious relationships between a number of people in situations which often give much cause for disagreement. Thus, where trading risks are very great, the partnership is not a very stable type of organization.

CORPORATIONS

A corporation is a business unit that is legally separate from its owners. A business corporation is an institution established for the purpose of making profit. It is operated by individuals. The ownership being represented by shares of stock in the corporation, the owners do not directly control the operations of the corporations. Instead they elect a board of directors who run the corporation for the benefit of the stockholders. Their shares of ownership are represented by stock certificates. A person who owns a stock certificate is called a stock-holder. In exchange for a restricted involvement in the corporation’s actual operations, stockholders enjoy limited liability. That is their risk of loss is limited to the amount paid for their shares. If they wish stockholders can sell their shares to other people without affecting corporate operations. Because of this limited liability, stockholders are often willing to invest in riskier, but potentially profitable activities. Also, because ownership can be transferred without dissolving the corporation, the life of the corporation is unlimited and not subject to the whims or health of a proprietor or partner. 

There are several advantages of the corporate form of ownership. The first is the ability to attract financial resources. The next advantage is the corporation attracts a large amount of capital it can invest it in plants, equipment and research. And the third advantage is that a corporation can often higher salaries and thus attract talented managers and specialists.

The privately owned business corporation is one type of corporation. There are some other types too. Educational, religious, charitable institutions can also incorporate. Usually such corporation does not issue stock and is nonprofit. If there is a profit it is reinvested in the institution rather than distributed to private stockholders.

In some western countries, cities, states, federal government and special agencies can establish governmental corporations. A few examples of these governmental corporations are state universities, state hospitals and city owned utilities. Governmental corporations are non-profit as a rule and usually they do not issue stock certificates.

Companies and Organizations

COMPREHENSION CHECK

 

I. Give English equivalents to the following:

Bести дело; партнер с ограниченной юридической ответственностью; ча-стная собственность; получать льготы по налогообложению; быть юридически ответственным; недвижимость; выпускать акции; привлекать финансовые ре-сурсы; привлекать большой капитал; акционер, держатель акций; повторно ин-вестировать; предлагать высокие оклады; оплата расходов; сертификат акций; держатели акций; акционерный (долевой) способ формирования денежного фонда; образование денежного фонда с помощью займа; ценность (стоимость) акции; фиксированный процент (доля); единоличное владение; товарищество; собственник, владелец; юридически; хозяйственная единица; прибыль; убытки; обязательства; ответственность; акционерный капитал.

 

II. Complete the sentences using the words given:

COMPREHENSION CHECK

 

I. Give English equivalents to the following:

Матричная структура, иерархическая структура, функциональная структура, совет директоров, штат сотрудников, филиал (отделение), дочерняя фирма, средний менеджмент, собрание акционеров, руководство фирмы, общие проблемы и перспективы организации, гибкость и быстрота реагирования компании на изменения внешней среды, работать под чьим-л. руководством, максимально эффективное использование высококвалифицированной рабочей силы, творческий потенциал сотрудников, подразделение, передача части управленческих функций средним менеджерам, дублирование функций.

 

II. Read the words and guess their meanings:

1	Accounts Dept.	department responsible for administering a company's financial affairs
2	A.G.M.UK	abbr. Annual General Meeting of a company's shareholders
3	board of directors	group of people chosen to establish policy for and control a company
4	chairmanUK	person who heads a Board of Directors; head of a company; chairperson
5	director	a member of the board of directors
6	executive officerUS	person managing the affairs of a corporation - chief executive officer
7	headquarters	a company's principal or main office or centre of control
8	manager	person responsible for day-to-day running of a dept.; executive officerUS
9	managing directorUK	senior director after the chairman responsible for day-to-day direction
10	Marketing Dept.	department that puts goods on market, inc. packaging, advertising etc
11	organisation chart	a table or plan showing a company's structure graphically
12	Personnel Dept.	department responsible for recruitment and welfare of staff or employees
13	presidentUS	the highest executive officer of a company; head of a company
14	Production Dept.	department responsible for physical creation of product
15	Purchasing Dept.	department responsible for finding and buying everything for a company
16	R & D Department	department responsible for Research and Development of (new) products
17	reception	the place where visitors and clients report on arrival at a company
18	Sales Department	department responsible for finding customers and making sales
19	shareholder	person who holds or owns shares in or a part of a company or corporation
20	vice presidentUS	any of several executive officers, each responsible for a separate division

Who is who?

1. Chief Executive Officer 2. Information Systems Director 3. Purchasing Director 4. Human Resources Director for sale to customers. 5. Systems Analyst 6. Managing Director 7. Marketing Director 8. Production Director 9. Customer Service Manager 10. Staff Development Officer 11. Finance Director 12. Exports Manager

a. Manager responsible for (CEO) buying. b. Person who designs computer networks c. British English term for senior manager of a company. d. Manager responsible for the creating goods or services  e. American English term for the top manager of a company f. Person responsible for setting up training opportunities for employees g. The person responsible for computer operations in a company. h. Person responsible for managing product development, promotion, customer service, and selling. i. Person responsible for markets in other countries. j. Manager responsible for personnel issues. k. Person responsible for relationships with customers l. Person responsible for presentation and control of profit and loss.

III. Complete these sentences using the words from the list below and translate the sentences into Russian:

climate

clarify

career

depend on

delegate

equipped

facilitate

hierarchy

interactions

informal

improve

link

limit

management

response

skills

weaknesses

Communication, the (1) _____ between an organization and its members, is essential to the organization’s major functions. When you understand how the organization communicates, you are (2) _____ to become a productive member of the group. Communication also facilitates (3) _____ among management, employees, customers, suppliers, financiers, and government officials. Communication occurs through both formal and informal channels and flows up and down the hierarchy, as well as across the line of authority. Open communication patterns encourage links among all members of the organization and (4) _____ complex activities that require creativity. Tightly controlled communication patterns that (5) _____ an official hierarchy are well suited to situations that call for a rapid (6) _____. An organization’s communication (7) _____ is affected by the corporation’s management style and ethics. Given the volume of messages flowing into, around, and out of modern organizations, communications (8) _____ has become an issue. In many organizations many managers are encouraged to (9) _____ the number of messages, (10) _____ communication assignments, (11) _____ responsibility for writing and speaking, and build employees` communication (12) _____. Many organizations have also developed plan for communicating during times of crisis. Regardless of where you work or what you do, communication will play a part in your career. By analyzing your strengths and (13) _____, setting realistic goals and practicing different types of communication you can (14) _____ your verbal and written communication skills.

IV. Translate into English:

1. Классическая матричная структура возникла как реакция на необходимость проведения быстрых технологических изменений при максимально эффективном использовании высококвалифицированной рабочей силы.

2. Иерархическая структура организации хороша тем, что обеспечивает точное распределение задач и обязанностей внутри компании; легко контролируема и управляема сверху.

3. Иерархическая структура организации плоха тем, что:

· вся ответственность замыкается на высшем руководстве;

· мешает сотрудникам видеть общие проблемы и перспективы организации;

· интересы отдела могут стать для работников важнее интересов организации в целом;

· происходят потери информации при переходе с одного иерархического уровня на другой.

4. Преимущества матричной структуры заключаются в том, что

· она обеспечивает компании гибкость и быстроту реагирования на изменения внешней среды.

· работа в матричной структуре активизирует творческий потенциал сотрудников.

· матричная структура усиливает конечную ответственность каждого руководителя за проект.

5. Матричная структура плоха тем, что:

· работник или группа подчиняется одновременно нескольким руководителям, что снижает управляемость фирмой;

· матричная структура сложна для практической реализации;

· в рамках матричной структуры наблюдается тенденция к анархии, т.к. нечетко распределены права и ответственность между элементами структуры, наблюдается частичное дублирование функций;

· для этой структуры характерна борьба за власть, т. к. в ее рамках четко не определены властные полномочия.

 

V. Answer some questions on the Text:

1. What groups of people are most companies made of?

2. What is the management structure of a typical company like?

3. What is the Board of directors responsible for?

4. Who is responsible for the running of the business?

5. Name some of the departments or functions within a company?

6. What are the main factors of successful performance of the company over the years?

7. What is necessary for any company in order to survive & be successful?

8. What kind of information should a company profile contain?

9. Why are organizations so important for us?

10. How do people feel about organizations?

11. What is the reason for the existence of organizations?

12. What kind of behavior is typical of organizations?

13. Why do organizations influence our behavior?

14. Why are the people only beginning to realize the importance of studying organizations?

 

Литература

Основная: 1, 2, 5.

Дополнительная: 3, 4, 9, 10.

 

 

TOPIC 6.

ACCOUNTING

Accounting can be defined as the measuring and recording of all relevant financial data concerning a particular entity that is business, government organisation, etc.

Financial reporting is the communicating of such information in appropriately summarised form. In the UK such summarised form is called "Accounts". In the USA it is called "Financial statements". These accounts or statements are communicated to interested par­ties both within and outside the organisation.

Financial reporting provides information that is useful to present and potential investors, creditors and other users in making rational investment, credit and other economic decisions.

Accounting is often referred to as the "language of business". It is used in the business world to describe the transactions entered into by all kinds of organisations.

The actual record-making phase of accounting is usually called book-keeping. However, accounting extends far beyond the actual making of records. Accounting is concerned with the use to which these records are put, their analysis and interpretation.

Accountants are therefore those individuals specialised in the "art" of capturing the correct data, and preparing the most mean­ingful financial reports from that data. They are "producers" of fi­nancial information, which is then made available to "consumers" such as owners and lenders.

Accountants are assisted in their work by bookkeepers, who op­erate some form of accounting system, usually computerised, to help capture, accumulate, categorise, summarise and report the many thousands of transactions that affect an economic entity every year.

Accounting shows a financial picture of the firm. An accounting department records and measures the activity of a business. It reports on the effects of the transactions on the firm’s financial condition. Accounting records give a very important data. It is used by management, stockholders, creditors, independent analysts, banks and government.

Most businesses prepare regularly the two types of records. That is the income statement and balance sheet. These statements show how money was received and spent by the company.

One major tool for the analysis of accounting records is ratio analysis. A ratio analysis is the relationship of two figures. In finance we operate with three main categories of ratios. One ratio deals with profitability, for example, the Return on Investment Ratio. It is used as a measure of a firm’s operating efficiency.

The second set of ratios deals with assets and liabilities. It helps a company to evaluate its current financial position.

The third set of ratios deals with the overall financial structure of the company. It analyses the value of the ownership of the firm.

The purpose of accounting is to provide the company's shareholders with a clear picture of the company's financial health. This "photograph", which is usually published once a year, can be used as a managerial tool, allowing us to see how efficient a company is, and whether it should stay in business.

 

Read and memorize the following words and word combinations:

income statement   отчет о доходах

balance sheet    балансовый  отчет

ratio analysis    анализ коэффициентов

return on investment ratio – коэффициент возвращения инвестиций

assets and liabilities актив и пассив

accounting       бухгалтерский учет и отчетность

account            счет

to define           определять

to measure        измерять

to record           записывать, учитывать

relevant            соответствующий

data                  данные, факты

datum               факт

concerning       касательно

particular         определенный

entity                юридическое лицо, организация

to report           составлять отчет о

reporting          отчетность

to communicate сообщать

communication сообщение

information               сведения

appropriate      соответствующий

appropriately   соответственно        

to summarise   суммировать           

summarised               суммированный

in summarised form в соответствующем суммированном виде

to call              называть

to be called       называться

statement          заявление, отчет, выписка (по счету)

party                 сторона

interested parties заинтересованные стороны

user                  пользователь

decision            решение

auditor             аудитор

range                диапазон

a wide range of широкий круг

profit               прибыль

to lend (lent, lent) давать кредит

lender              кредитор

successful         успешный

competitor        конкурент

to withdraw      отзывать, отметить, убирать (зд. снять со счета)

to capture         зд. подбирать