Industrial Production and Services

Every day we can see people carrying out economic activities (1). They are taking place in houses, shops, offices (2), factories and banks, on farms, on building sites, and so on. The study of this great variety of activities is made much easier by classifying them into three main types of activity (3) – production, consumption and exchange (4).

The word production is usually taken to mean the making of some physical object (5), such as a motor car, a piece of furniture or a pair of shoes, or the growing of some particular crop, such as wheat or potatoes.

In economics, however, the word production has a much wider meaning. Production takes place so that people’s wants (6) can be satisfied. Any kind of work which helps to satisfy (7) people’s wants, and for which they are prepared to pay a price (8), is productive work (9).

Production, therefore, includes the output of services (10) as well as goods. If people are prepared to pay a price for a service, it must be satisfying a want in the same way as a physical object.

The people who work in service industries (11) (such as wholesaling (12), retailing (13), banking (14), insurance, accountancy (15), transport (16), the law (17), education and health) are productive in the same way as car workers and farmers. It is that, in a modern economy, factories, mines, power stations, farms. etc. would find it impossible to operate (18) without such services.

Consumption describes the ‘using up’ of goods and services in order to satisfy our wants.

In a modern economy, a large part of total consumption (19) consists of services. In Britain, for example, people are all very dependent on the transport, telephone, legal, education and health services (20). Entertainment (21) is another important service industry.

1. займатися економічною діяльністю; 2. контори; 3. головні ради діяльності; 4. обмін; 5. матеріальний предмет; 6. людські потреби; 7. задовольняти; 8. ладні сплачувати певну ціну; 9. виробнича праця; 10. надання послуг; 11. сфера послуг; 12. оптова торгівля; 13. роздрібна торгівля; 14. банківські операції; 15. бухгалтерський облік; 16. транспортні послуги; 17. правові послуги; 18. працювати; 19. загальне споживання; 20. залежать від послуг; 21.розваги.