The Concept of Business

Contents

Preface                   

1. The Concept of Business           5

2. Economics               9

3. Types of Companies                 14
4. Careers in Business             20

V. Management              21

VI. Factory Production             33

VII. Marketing               39

VIII. Advertising               44

IX. Commerce               49

X. Finance and Accounting.            53

 

Reference Literature               59

 

 

PREFACE

 

Basics of Economics is a business course aimed at developing reading comprehension and speaking skills for lower intermediate to intermediate level correspondence students. It is also intended for upper secondary school students, University students, young adults, and others who have studied English for some time but who want to get some knowledge of business English.

Basics of Economics contains 10 units organized around basic business topics. The topics and vocabulary covered correspond to the Standard Syllabus for Foreign Languages taught in the Republic of Belarus.

Each of the ten units of the course is organized around a topic and related functions. The exercises in each unit of the book are designed to prepare a student for getting background knowledge of the topic.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1. The Concept of Business

 

1. Go through the following vocabulary notes to avoid difficulties in understanding and find these words in the text.

 

exchange	обмен	corporation	ассоциация
distribution	распределение	certificate	документ, свидетельство
sale	продажа	share	акция
profit	прибыль	stockholder, shareholder	акционер владелец акций
production	производство	expenses	затраты
conversion	переработка	entity	экономический объект, хозяйственное  подразделение
dealership	местное представительство	partnership	товарищество
proprietorship	право собственности

 

2. Match the words in the left column with the definitions in the right column.

 

1.business 2.profit 3.production 4.distribution 5.sale 6.surplus

a) excess of revenues over outlays and expenses in a business enterprise over a given period of time, usually a year; b) an industrial, commercial, or professional operation; purchase and sale of goods and services; c) the creation or manufacture for sale of goods and services with exchange value d)the exchange of goods, property, or services for an agreed sum of money or credit; e) a quantity or amount in excess of what is required; f) the process of physically satisfying the demand for goods and services.

 

3. Read the text and give the definition of business.

 

Business is a word that is commonly used in many languages. Traditionally, business simply meant exchange or trade for things people wanted or needed. Nowadays, the concept and activities of business have increased. One definition of business is production, distribution, and sale of goods or services for a profit. To examine this definition, let us look at its different parts.

First, production is the creation of services or processing of materials into products. Example is the conversion of iron ore into metal car parts. Next, these products need to be moved from the plant to the marketplace. This is known as distribution. A car might be moved from a plant in Germany to a car dealership in Poland. Third is the sale of goods and services. Sale is the exchange of a product or service for money. A car is sold to someone in exchange for money.

Goods are products that people either need or want; for example, cars can be classified as goods. Services, on the other hand, are activities that a person or group performs for another person or organization. For example, an auto mechanic performs a service when he repairs a car. A barber renders a service when he cuts your hair.

Business, then, is a combination of all these activities: production, distribution, and sale. However, there is another important factor, i.e., creation of profit or economic surplus. A major goal in the functioning of any business company is making 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.

 

4. Answer these questions using the active vocabulary of the text.

 

1. What is the traditional definition of business?
2. Is business production, distribution and sale of goods and services for a profit?
3. What is the creation of services or processing of materials into products?
4. How do we call the process of moving products from the plant to the market place?
5. Sale is the exchange of a product or service for money, isn’t it?
6. What kind of activities are services?
7. What is a major goal of any business company?
8. What does a company get after all expenses are paid?

 

5. Read the text again and decide whether these statements are true (T) or

false (F).

 

1. Business is production, distribution, and sale of goods or services for a profit.

2. Production is the exchange of a product or service for money.

3. Distribution is moving from the plant to the marketplace.

4. Sale is the creation of services or processing of materials into products.

5. Services are activities that a person or group performs for another person or organization.

6. Profit is the money that remains after all the expenses are paid.

 

6. Choose Russian equivalents to the following phrases.

 

exchange for things

a) обмен вещей;

b) обмен на вещи;

c) изменение вещей.

 

the creation of services

a)оказание услуг;

b)создание услуг;

c)организация услуг.

 

the money that remains

a) деньги оставленные;

b) деньги, которые остаются;

c) деньги, что оставят.

 

7. Make an outline of the text consisting of 5-8 sentences.

 

8. Retell the text according to its outline.

 

II. Economics

 

1. Go through the following vocabulary notes to avoid difficulties in understanding and find these words in the text.

 

decrease	уменьшать	consumer	потребитель
scarce	недостаточный, скудный	accounting	бухгалтерское дело
inputs	затраты (на производство)	employment	занятие; работа (по найму)
output	продукция; выпуск изделий	labor force	рабочая сила
allocate	распределять	increase	увеличивать

 

2. Match the words in the left column with the definitions in the right column.

 

1.economics 2.macroeconomics 3.microeconomics 4.scarcity 5.resources 6.goods 7.employment 8. economic growth 9. price stability

a) the state achieved by monetary control, balanced budgets, etc.; b) the branch of economics concerned with particular commodities, firms, or individuals and the economic relationships between them; c) possessions and personal property d) inadequate supply; e) the social science concerned with the production and consumption of goods and services and the analysis of the commercial activities of a society; f) the work or occupation in which a person is employed; g) a source of economic wealth, esp. of a country (mineral, land, labor, etc.) or business enterprise (capital, equipment, personnel, etc.); h) the branch of economics concerned with aggregates, such as national income, consumption, and investment; i) this period characterized by rising wages, profits, and prices, full employment, and high levels of investment, trade, and other economic activity.

 

3. Read the text and explain the highlighted words.

 

Economics is the study of how society allocates scarce resources and goods. Resources are the inputs that society uses to produce output, called goods. Resources include inputs such as labor, capital, and land. Goods include products such as food, clothing, and housing as well as services such as those provided by doctors, repairmen, and police offices. These resources and goods are considered scarce because of society's tendency to demand more resources and goods than are available.

Most resources are scarce, but some are not — for example, the air we breathe. Its price is zero. It is called a free resource. Economics, however, is mainly concerned with scarce resources and goods, as scarcity motivated the study of how society allocates resources and goods.

The term market refers to any arrangement that allows people to trade with each other. The term market system refers to the collection of all markets, also to the relationships among these markets. The study of the market system, which is the subject of economics, is divided into two main theories; they are macroeconomics and microeconomics.

Macroeconomics

The prefix macro means large, indicating that macroeconomics is concerned with the study of the market system on a large scale. Macroeconomics considers the aggregate performance of all markets in the market system and is concerned with the choices made by the large subsectors of the economy — the household sector, which includes all consumers; the business sector, which includes all firms; and the government sector, which includes all government agencies.

Microeconomics

The prefix micro means small, indicating that microeconomics is concerned with the study of the market system on a small scale.

Microeconomics considers the individual markets that make up the market system and is concerned with the choices made by small economic units such as individual consumers, individual firms, or individual government agencies.

Economic Policy

An economic policy is a course of action that is intended to influence or control the behavior of the economy. Economic policies are normally implemented and administered by the government. The goals of economic policy consist of value judgments about what economic policy should strive to achieve. While there is some disagreement about the appropriate goals of economic policy, there are three widely accepted goals including:

1. Economic growth: It means that the incomes of all consumers and 
   firms (after accounting for inflation) are increasing over time.
2. Full employment: It means that every member of the labor force who 
   wants to work is able to find work.
3. Price stability: It means to prevent increases in the general price level 
   known as inflation, as well as decreases in the general price level 
   known as deflation.

 

4. Answer these questions using the active vocabulary of the text.

 

1. What is the definition of economics?
2. Why are resources scarce?
3. What are the two main theories of economics?
4. What do they deal with?
5. What are the goals of economic policy?
6. What is inflation?

 

5. Read the text again and decide whether these statements are true (T) or false (F).

 

1. Economics is the study of how society allocates scarce resources and goods.
2. Society's tendency is to demand more resources and goods than are available.
3. The term market refers to any arrangement that allows people to trade with each other.
4. Microeconomics is concerned with the study of the market system on a large scale.
5. Macroeconomics is concerned with the choices made by small economic units such as individual consumers, individual firms, or individual government agencies.
6. Economic policies are normally implemented and administered by the private sector.
7. Three widely accepted goals include labor force, inflation and the incomes of all consumers.

 

6. Find Russian equivalents to the following phrases in the second column.

 

1.scarce resources 2.available 3.on a large scale 4.aggregate performance 5.household 6.implemented 7.value judgments 8.strive to 9.appropriate goals 10.general price level

a)в крупном масштабе b)доступный c)хозяйственный d) субъективные оценки e)недостаточные ресурсы f)общий ценовой уровень g)реализованный h) стараться, пытаться i)совокупная производительность j)соответствующие показатели

 

7. Make an outline of the text consisting of 5-8 sentences.

 

8. Retell the text according to its outline.

 

 

III. Types of Companies

 

1. Go through the following vocabulary notes to avoid difficulties in understanding and find these words in the text.

 

debt	долг	bankruptcy	Банкротство
assets	активы	enterprise	предприятие
liabilities	пассивы	joint venture	cовместное предприятие
proprietor	собственник	accountant	бухгалтер
pledge	закладывать	charter	устав

 

2. Match the words in the left column with the definitions in the right column.

 

sole proprietorship partnership general partnership joint venture limited company

a) It is a business in which two or more companies have invested, with the intention of working together; b) It is the legal entity having a right to issue stock certificates; c) It is an association of two or more people involved in business under a written partnership agreement; d) It is more often used by lawyers, doctors, dentists, and chartered accountants; e) It means going into business for oneself.