V Equity Market

a) Supply the prepositions where necessary.

b) Write down 3-5 questions about the text.

c) Describe the trends in the major equity markets mentioned in the text.

In return____ the use of their funds, investors in a corporation are issued certificates,

or securities. Corporate securities represent claims_______ the assets and future earnings of

the firm. Corporate securities take the form_____ either common stock (звичайні акції) or

preferred stock.

In 1980 the US equity market was the largest domestic equity market in the world and was three times larger than its nearest rival, the Japanese market. During 1990 there were periods when the capitalization of the Tokyo Stock Exchange was higher than the NYSE. These relative values can fluctuate quite dramatically. For example, the Tokyo Stock

Exchange market capitalization fell ______ 29% in the mid two quarters of 1990. The

London Stock Exchange only fell by 17%_____ this period. As a result, the value rankings

(класифікація) are not stable over short periods. However, one can see the rapid rise of

the Tokyo Stock Exchange____ the 1980s, the relative decline of US stock markets, and

the slow but sure growth of London and the other European stock exchanges.

The UK has a large domestic and international equity market relative to (відносно) the size of its economy. This market is the most international in terms of foreign

companies listed and the extent_____ foreign equities traded. In contrast, German equity

markets are small relative_____ the size of the economy. The UK, Canadian and the US

domestic capital markets are very similar_____ each other in that many domestic firms are

quoted and equity is a significant form of finance. However, most of the smaller domestic

capital markets can be characterized as consisting______ very few firms which are widely

publicly held. Small group and family holdings (володіння акціями) predominate
(переважати) and new equity issues are avoided for fear_____ losing control.

VI. Production. Match up the words with the definitions.

1. capacity	a) any company that provides goods or services for another one
2. component	b) any of the pieces or parts that make up a product, machine, etc.
3. inventory	c) buying products or processed materials from other companies rather than manufacturing them
4. lead time	d) the (maximum) rate of output that can be achieved from a production process
5. location	e) the geographical situation of a factory or other facility
6. outsourcing or contracting out	f) the buildings, machines, equipment and other facilities used in the production process
7 plant	g) the stock of any item or resource used in an organization (including raw materials, parts, supplies, work in process and finished products)
8. subcontractor	h) the time needed to perform an activity (i. e. to manufacture or deliver something)

134 PART II. FINANCE

6. A sentence saying that the shareholders wish to form this company. Each

shareholder signs the Memorandum and writes next to his/her name the number of shares he/she is buying. Write the date.

NOTE: The Articles are more complicated and give details of how the company will be run, how often shareholders' meetings will be held etc. There is no standard format for the Articles of Association, because they detail the day-to-day running of the company, how often official meetings are to be held, who is responsible for what jobs, how many people must be at a meeting etc. - and these details are very different from company to company. Do not write this document.

PART II. FINANCE