Ex.3. Fill in the gaps with the words and expressions from the text

1. The model of the economy is concerned with forecasting ___so as to aid

___by business and government.

2. Such predictions are, aid to business decision-making because businesses can find out whether people's incomes ___to rise or not.

3. These units together decide the economy's ____,___and___.

4. In order to develop a simple model of the economy we need to ___the

government sector and ___ between ___ and ___.

5. Suppose we are dealing with___, one which has no government.

6. In order to develop ______ of the economy we need to ___that there are

two main sectors in the economy: __ and____.

7. Households provide___, both___, in return for___.

8. If the finance is in the form of___, households receive, but if they

have purchased ___in the business they may be entitled to___.

9. Households receive payments for., that is to say, they earn___, such

as ___, ___and___.

10. There are two flows: one which is ___ and one ____ goods and

services.

Ex.4.Answer the questions.

1. What units does the economy comprise? What do they decide?

2. What are the two main sectors in the economy?

3. What sets of actions create the model of the circular flow of income?

4. Dwell on the monetary flow. How is the level of national income connected with it?

5. Dwell on the flow of goods and services.

6. What does the figure suggest?

7. How can the amount of economic activity be measured?

8. What's an equilibrium? a neutral equilibrium?