Учебник по Английскому Языку. Economy and Finance (2курс, 1 семестр). Учебник по Английскому Языку. Economy and Finance (2курс, 1 семе. Министерство экономического развития и торговли Российской Федерации Российский Государственный ТорговоЭкономический Университет
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UNIT 3 Money SupplyMoney supply in most countries comprises currency – banknotes and coins issued by the central bank and various kinds of deposits held by the public at commercial banks. The definition of the money has varied. For centuries physical commodities, most commonly silver or gold, served as money. Later paper money became the main financial instrument around the world. To regulate the national economy and influence the world trade monetary authorities have the power to issue paper money without legal restrictions. As money is used in all economic transactions, it has a great effect on economic activity. The amount of money in circulation and its velocity of circulation determine the average level of prices and wages. An increase in the supply of money puts more money in the hands of consumers, making them feel wealthier, thus stimulating spending. Business firms respond to growing sales by ordering more raw materials and intensifying production. The spread of business activity increases the demand for labour. In a booming economy stock market prices rise and firms issue shares and bonds. If the money supply continues to expand, prices begin to rise, especially if output growth reaches capacity limits. Lenders insist on higher interest rates to offset an expected decline in purchasing power. Opposite effects occur when the supply of money falls. Economic activity declines and either disinflation (reduced inflation) or deflation (falling prices) results. The most important determinant of the money supply is the central bank. By increasing or decreasing the money supply, the central bank indirectly influences interest rates, demand, output, unemployment and prices. The central bank can reduce the reserves available to commercial banks by changing the reserve requirements. This reduces the amount of money that banks can create and makes the money tight. Wordsandexpressions money supply - денежная масса; денежное предложение (количество денег, выпущенное в стране, обычно центральным банком) comprise (v) - включать, содержать, составлять physical commodities - физические товары legal (adj) - правовой, юридический, законный restriction (n) - ограничение without restriction - без ограничения to impose, place, put restrictions on smth. - вводить, налагать ограничения на что-либо to lift restrictions - снимать ограничения velocity (n) - скорость, быстрота consumer (n) - потребитель wealthy (adj) - богатый, состоятельный e.g. She is from a very wealthy family - Она из очень состоятельной семьи. thus (adv) - таким образом respond (v) - отвечать to respond to smth. - отвечать чему-либо to respond to the demand - удовлетворять спрос booming economy - экономика переживающая подъем stock market - фондовый рынок bond (n) - облигация toissuebonds - выпускать облигации output growth - рост объема производства offset (v) - возмещать, компенсировать purchasing power - покупательная способность (стоимость денег, измеряемая в соответствии с количеством товара, который можно на них приобрести) occur (v) - происходить, случаться, совершаться determinant (n) - определяющий фактор, детерминант exchange rate determinant - детерминант валютного курса tight (adj) - скудный, недостаточный tightpolicy - жесткая политика to implement (pursue) a tight policy - проводить, осуществлять жесткую политику Exercises 1. Answer the questions. 1) What does money supply in most countries comprise? 2) What physical commodities were used for money? 3) What does the amount of money in circulation determine? 4) How does the increase in the money supply affect the economy? 5) What effects may the increased money supply lead to? 6) What happens when money supply falls? 7) What are disinflation and deflation? 8) What institution determines the money supply? 2. Complete the sentences with words and phrases from the right part. 1) Money supply in most countries a) either disinflation or deflation comprises … results. 2) Business firms respond to increased b) firms issue shares and bonds. sales by ordering more … 3) In a booming economy, stock market c) currency. prices rise and … 4) If the money supply continues to d) an expected decline in purchasing expand … power. 5) Lenders insist on higher interest e) the central bank. rates to offset … 6) Economic activity declines and … f) raw materials. 7) The most important determinant of g) prices begin to rise. the money supply is … 3. Translate into English. 1) Население держит вклады в различных коммерческих банках. 2) Долгое время физические товары, чаще всего золото и серебро, служили в качестве денег. 3) В целях регулирования национальной экономики финансовые органы наделяются полномочиями по выпуску бумажных денег. 4) Так как деньги используются во всех экономических операциях, они оказывают большое воздействие на экономическую деятельность. 5) Компании отвечают на рост продаж, заказывая большее количество сырья. 6) Рост деловой активности увеличивает спрос на рабочую силу. 7) В экономике, переживающей подъем, цены фондового рынка растут, и компании выпускают акции и облигации. 4. Complete the text using the words: credit, output, demand, inflation, circulation, unemployment, interest rates If a government pursues a tight monetary policy, it restricts the amount of money in 1) … and reduces the funds available to banks. When money is tight: 2) … rise, because commercial banks have to borrow at a higher rate on the inter-bank market. 3) … falls, because people and businesses borrow less at higher rates. 4) … falls, because people and businesses buy less, as they have less money. 5) … falls too, because with less consumption, firms produce less. 6) … rises, because companies are producing and selling less, and so need less labour. 7) … falls, because there is less money in circulation. 5. Read the text and translate it into Russian. The Financial Management The financial plan of a company includes the timing and the amounts of funds, as well as the inflow and outflow of money. Financial managers also forecast the economic conditions, the company’s revenues, expenses and profits. The plan starts and ends with the company’s objectives. Managers review them and determine the funding they require. Managers also compare the expenses involved and the revenues expected. It helps them predict cash flow. Management plans a strategy to make the ending cash positive, and accordingly works out the way the resources should be allocated. Resources are invested according to the strategic plan of a company into materials and inventory, personnel and advertising, etc. Managers are responsible for carrying out this strategy, the whole process being supervised by the General Executive and the Board of Directors of the company. 6. Translate the questions into English and answer them. 1) Что включает в себя финансовый план компании? 2) Что еще прогнозируют финансовые менеджеры? 3) Чем начинается и заканчивается план? 4) Что сравнивают менеджеры? 5) Какова цель финансовой стратегии? 6) Во что инвестируются ресурсы? 7) Кто отвечает за выполнение финансовой стратегии? 8) Кем контролируется весь процесс? 7. Summarize the information of the unit and speak on the topic: Money Supply |