Put the sentences into Past and Future Simple

1. It is not a difficult matter to give a simple answer to that basic question.

2. People apply their knowledge and efforts to the gifts' of nature in order to satisfy their material wants.

3. Even in the prosperous countries there is an aspect of survival.

4. This problem attracts little attention.

5. Such people have the abilities to sustain life without outside assistance.

6. They experience great poverty.

7. They depend on the efforts and cooperation of many thousands of specialist workers.

6. Answer the following questions:

1. What do most introductory books on Economics begin by?

2. What does Economics study?

3. What does it limit itself to?

4. What is an underlying problem of Economics?

5. What categories of people can survive without outside assistance?

6. Why do they have a very low standard of living?

7. Why aren't the inhabitants of big cities economically independent?

8. Why is a high standard of living impossible without a cooperation of large numbers of people?

7. Find synonyms among these words:

study, precise, complex, subject, essentially, use, exact, matter, basically, mainly, apply, developed, examine, advanced, completely, help, community, totally, assistance, society, build, gift, construct, present.

8. Find antonyms among the following words:

begin, difficult, high, poor, inside, wealth, finish, easy, low, prosperous, outside, poverty, capable, dependence, incapable, directly, large, independence, indirectly, small.

9. Home reading. Read the text and explain the meanings of the following terms:

‘Capital’, ‘Wealth’, ‘Fixed capital’, ‘Money’

CAPITAL

Capital is a man-made resource. Any product of labour and land which is reserved for use in the further production is capital.

Capital was created when people began to make simple tools and implements to assist them in the production of food, the hunting of animals, and in the transportation of their possessions.

It might be helpful at this stage to deal with the confusion which commonly arises over the meanings of three important terms: capital, money and wealth.

Capital, as already indicated, means any produced means of production.

Wealth is quite simply the stock of all those goods which have a money value. Capital, therefore, is an important part of the community’s wealth.

Money is a claim to wealth. From the standpoint of the community as a whole, money is not wealth, since we can not count both the value of real assets and the value of the money claims to those assets. From the point of view of the individual citizen, however, money represents a part of his personal wealth, since he sees it as a claim on assets held by other people. To the individual business person, therefore, any money he possesses he regards as capital, since it gives him a claim on resources now possessed by others. We must be quite clear, however, that money is not part of the national wealth.

Capital is usually divided into two types: that which is used up in the course of production and that which is not.

Working capital consists of the stocks of raw materials, partly finished goods held by producers. These stocks are just as important to efficient production as are the machines and buildings. Stocks are held so that production can proceed smoothly when deliveries are interrupted and so that unexpected additional orders for finished goods can be met without changing production schedules. This kind of capital is sometimes called circulating capital because it keeps moving and changing. Materials are changed into finished goods which are then exchanged for money and this is used to buy more materials.

Fixed capital consists of the equipment used in production – buildings, machinery, railways and so on. This type of capital does not change its form in the course of production and move from one stage to the next – it is ‘fixed’.

UNIT 2