The nature of business

A business is a person, a group of people, or an organization that meets needs. All businesses start with an idea. A person or an organization identifies a need or demand and decides to meet that demand. A business is then organized to put that idea to work. Behind the idea lies motivation. One motivating force in business is profit, the income earned by a business.

Meeting needs has two sides. The person or organization with the demand is the buyer, or customer. The person or organization that meets the demand is the seller, or supplier.

You have demands for both goods and services. You meet these demands by doing business with people or organizations that can meet your demands. In exchanging something of value, such as money, for something you want, you are taking part in a business transaction. A transaction, then, is the basic act of doing business.

Operating a business requires an investment of resources. Resources include money, time, skill, experience and work. An investment involves risk – a business can fail.

Businesses circulate money. The income of a business provides money for the payroll, supplies, and other expenses of operation. The proprietor draws income from money left after expenses. Employees of the business are customers of other businesses. The business itself is a customer of other businesses from which it purchases the products it needs to operate.

The financial condition of a business is determined by a process called accounting. Original entries of business transactions are recorded in journals. At specific intervals, the information is summarized into financial statement. Accountants then interpret the figure to determine the financial strength of the business.

The world of business revolves around putting ideas and resources to work to create opportunities.

Businesses are created in response to the market system.

Text 3

I. Remember the following words and word-combinations:

1.amount	сума
2.circular flow	круговорот
3.competition	конкуренція
4.consumer goods	товари широкого вжитку
5.labour	труд
6.natural resources	природні багатства
7.price	ціна
8.market price	ринкова ціна
9.shortage	недостача; нестача; брак чогось
10.surplus	лишок; зайвина; решта
11.supply	пропозиція
12.supply and demand curve	крива попиту та пропозиції
13.to exceed	перевищувати
14.to invest	вкладати (капітал)
15.utility	корисність; вигідність

II. Read and translate the text: