English for economists: Educational manual 9786010446441

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AL-FARABI KAZAKH NATIONAL UNIVERSITY

R. E. Sarbayeva M. K. Makisheva

ENGLISH FOR ECONOMISTS Educational manual Second edition, revised

Almaty “Kazakh University” 2020

UDC 812.111. (075.8) LBC 8/2 Англ. – 923 S 22 Recommended for publication Academic Council of the Faculty of International Relations and Editorial and Publishing Council of Al-Farabi KazNU (Protocol № 4 dated 19.06.2020) Reviewers: PhD, associate professor N.C. Asmatullaeva Candidate of Philology, associate professor F. A. Bataeva Candidate of Philology, associate professor G.T. Okusheva

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Sarbayeva R.E., Makisheva M.K. English for economists: Educational manual / R.E. Sarbayeva, M.K. Makisheva. – 2nd editian, revised. – Almaty: Kazakh University, 2020. – 140 p. ISBN 978-601-04-4644-1 “English for Economists”, an educational manual with its emphasis on accessible economic language is designed to meet the needs of the students of World Economy in acquiring basic knowledge on micro- and macroeconomic issues. The main purpose of the manual is to teach the English language through specialty, i.e. a professional-oriented language. The manual is given not as a complete course for students but as supplementary material to a General English course with an interest in or a need for Business English. Each Unit includes authentic special texts enabling to study the main notions of economic thoughts and concepts, to learn the history of functioning of economic systems and structures.

UDC 812.111. (075.8) LBC 8/2 Англ. – 923 ISBN 978-601-04-4644-1

© Sarbayeva R.E., Makisheva M.K., 2020 © Al-Farabi KazNU, 2020

PREFACE This educational manual “English for Economists” with its emphasis on accessible economic language is designed to meet the needs of the students of World Economy in acquiring basic knowledge on micro- and macroeconomic issues. There have been radical changes in the global economic system, in particular in microeconomics. The authors of the manual have tried to take into account these changes, the growing importance of the world and regional economic organizations as the WTO, the European Union, and Eurasian Economic Union etc. The main purpose of the manual is to teach the English language through specialty, i.e. a professional-oriented language. The manual consists of six Units devoted to separate aspects of economics: Introduction into economics History of economic thoughts Microeconomics Macroeconomics International economics Appendix and Practice Each Unit includes special texts which are followed with Essential Vocabulary and Tasks to be fulfilled after reading them. There is also a special Task aimed specifically at developing students’ communicative skills – giving a brief analysis of the text focusing on the current socio-economic situations at home and abroad. The manual is given not as a complete course for students but as supplementary material to a General English course with an interest in or a need for Business English. In Appendix students can find useful phrases and expressions which are widely used during the economic and business negotiations.

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Unit I INTRODUCTION INTO ECONOMICS

Economics is the social science studying the production, distribution and Text 1 consumption of goods and services. It is ECONOMICS a complex social science that spans from mathematics to psychology. At its most basic, however, economics considers how a society provides for its needs. Its most basic need is survival which requires food, clothing and shelter. Once those are covered, it can then look at more sophisticated commodities such as services, personal transport, entertainment, the list goes on. Today, this social science known as “Economics” tends to refer only to the type of economic thought which political economists refer to as Neoclassical Economics. It developed in the 18th century based on the idea that Economics can be analyzed mathematically and scientifically. Other schools of thought have included Classical and Modern Political Economy, Marxian Economics, Institutional Economics and Keynesian Economics. These all have different emphases on certain aspects of economics. Economics has been recognized as a special area of study for over a century. Virtually all Universities offer courses in economics and most allow students to major in the subject. Economists maintain high profiles in governments and they have been well-represented among the highest appointees in the governments of states. The press reports on their doings and sayings, sometimes with praise and admiration, sometimes with ridicule and scorn. Economics and economists are words that almost everyone has heard of and uses. But what exactly is economics? Very few people can give a good definition or description of what this field of study is all about. If ordinary citizens cannot give a good definition or description of economics, they can be excused because economists long struggled to define their field. In addition, the subject matter that economists study is not well-defined. In recent years, for example, economic journals have published papers on topics such as sex, crime, slavery, 4

childbearing, and rats. It is not surprising, then, that one economist, in a lighter moment, suggested that economics can be defined as “what economists do”. Defining economics as “what economists do” does not tell us anything we not already knew. A good definition must explain what it is that makes economics a distinct subject, different from physics or psychology. One should not expect to find a short definition that conveys with absolute clarity all there is to know about economics (or else there would be no reason to spend hours learning about it). Neither one should believe that there is only one correct definition possible. Many good definitions are possible, and each will focus on some important aspect of the subject. Essential Vocabulary distribution and consumption

тарату жəне тұтыну

распределение и потребление

to span from

қамту

охватывать

to be covered

қамтылу

быть охваченным, покрывать

sophisticated commodities

кешенді тауарлар

комплексные товары

to major in the subject

белгілі бір салада мамандану

специализироваться в данной теме

to maintain high profiles

жоғары беделге ие болу

поддерживать высокие профили

ridicule and scorn

мысқылдау жəне жек көру

насмешки и презрение

to convey

жеткізу

передавать

to focus on

бірнəрсеге көңіл бөлу

сосредоточить внимание на

Tasks: 1. Read the text “Economics”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian

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Answer the following questions: 1. What is economics? 2. Why is Economics considered to be a complex social science? 3. What is the difference between Economics and Neoclassical Economics? 4. Why do economists maintain high profiles in the govern-ment? 5. Why is the subject matter of Economics not well-defined? 6. How will you define Economics on the modern stage?

Аn economist is a professional in the social science discipline of economics. The individual may also study, develop, PROFESSION and apply theories and concepts from OF AN ECONOMIST economics and write about economic policy. Within this field there are many sub-fields, ranging from the broad philosophical theories to the focused study of minutiae within specific markets, macroeconomic analysis, microeconomic analysis or financial statement analysis, involving analytical methods and tools such as econometrics, statistics, economics computational models, financial economics, mathematical finance and mathematical economics. A generally accepted interpretation in academia is that an economist is one who has attained a Ph.D. in economics, teaches economic science, and has published literature in a field of economics. The professionalization of economics, reflected in academia, has been described as “the main change in economics since around 1900. Economists debate the path they believe their profession should take. It is, primarily, a debate between a scholastic orientation, focused on mathematical techniques, and a public discourse orientation, which is more focused on communicating to lay people pertinent economic principles as they relate to public policy”. Surveys among economists indicate a preference for a shift toward the latter. However, these preferences expressed in private often differ with what is actually acted out in the public eye. Most major universities have an economics faculty, school or department, where academic degrees are awarded in economics. However, many prominent economists come from a background in mathematics, business, political science, law, sociology, or history. In Text 2

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contrast to regulated professions such as engineering, law or medicine, there is not a legally required educational requirement or license for economists. In academia, to be called an economist requires a Ph.D. degree in Economics. In the US government, on the other hand, a person can be hired as an economist provided that they have a degree that included or was supplemented by 21 semester hours in economics and three hours in statistics, accounting, or calculus. Politicians often consult economists before enacting economic policy, and many statesmen have academic degrees in economics. Economics graduates are employable in varying degrees, depending on the regional economic scenario and labour market conditions at the time for a given country. Apart from the specific understanding of the subject, employers value the skills of numeracy and analysis, the ability to communicate and the capacity to grasp broad issues which the graduates acquire at the university or college. The Nobel Memorial Prize in Economics, established by Sveriges Riksbank in 1968, is a prize awarded to economists each year for outstanding intellectual contributions in the field of economics. The prize winners are announced in October every year. They receive their awards (a prize amount, a gold medal and a diploma) on December 10, the anniversary of Alfred Nobel’s death. Essential Vocabulary to apply theories and concepts

теория мен қағидаларды қолдану

применять теории и концепции

to study minutiae of markets

нарықты жан-жақты қарастыру / зерттеу

подробно изучать рынок

to involve analytical methods

аналитикалық тəсілдер қолдану

использовать аналитические методы

a generally accepted interpretation

жалпы қабылданған түсіндірме

общепринятое толкование

to focus on

көңіл бөлу / назар аудару акцентировать внимание на

pertinent economic principles

тиісті экономикалық принциптер

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надлежащие экономические принципы

to express one’s preferences

өз ықыласын білдіру

заявлять о своих предпочтениях

in private

құпия түрде /жеке

конфиденциально

to award academic degrees

академиялық дəрежемен присуждать марапаттау академические степени

labour market conditions

еңбек нарығының жағдайы

outstanding intellectual contributions in

көрнекті зияткерлік үлес выдающийся интеллектуальный вклад в

to grasp broad issues

кең ауқымды мəселелерді қамту

условия рынка труда

охватывать широкий спектр вопросов

Tasks: 1. Read the text “Profession of an economist”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What is studied, developed and applied in the social science discipline of economics? 2. How is the profession of an economist interpreted in academia? 3. What are the debates of economists focused on? 4. What are the main requirements to be called an economist? 5. What personalities are awarded with the Nobel Memorial Prize in Economics?

There are a number of ways in which a government can organize its economy and the type of system chosen is critical in ECONOMIC SYSTEMS shaping environment in which businesses operate. An economic system is quite simply the way in which a country uses its available resources (land, workers, natural resources, machinery etc.) to satisfy the demands of its inhabitants for goods and services. The more goods and services that can be produced from these limited resources, the higher the standard of living e njoyed by the country’s citizens. There are three main economic systems: Text 3

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Planned economics. Planned economies are sometimes called” “command economies” because the state commands the use of resources (such as labour and factories) that are used to produce goods and services as it owns factories, land and natural resources. Planned economies are economies with a large amount of central planning and direction, when the government takes all the decisions, the government decides production and consumption. Planning of this kind is obviously very difficult, very complicated to do, and the result is that there is no society, which is completely a command economy. The actual system employed varies from state to state, but command or planned economies have a number of common features. Firstly, the state decides precisely what the nation is to produce. It usually plans five years ahead. It is the intention of the planners that there should be enough goods and services for all. Secondly, industries are asked to comply with these plans and each industry and factory is set a production target to meet. If each factory and farm meets its target, then the state will meet its targets as set out in the five-year plans. You could think of the factory and farm targets to be objectives which, if met, allow the nation’s overall aim to be reached. A planned economy is simple to understand but not simple to operate. It does, however, have a number of advantages: – Everyone in society receives enough goods and services to enjoy a basic standard of living. – Nations do not waste resources duplicating production. – The state can use its control of the economy to divert resources to wherever it wants. As a result, it can ensure that everyone receives a good education, proper health care or that transport is available. Several disadvantages also exist. It is these disadvantages that have led to many nations abandoning planned economies over recent years: – There is no incentive for individuals to work hard in planned economies. – Any profits that are made are paid to the government. – Citizens cannot start their own businesses and so new ideas rarely come forward. – As a result, industries in planned economies can be very inefficient. 9

A major problem faced by command or planned economies is that of deciding what to produce. Command economies tend to be slow when responding to changes in people’s tastes and fashions. Planners are likely to under produce some items as they cannot predict changes in demand. Equally, some products, which consumers regard as obsolete and unattractive, may be overproduced. Planners are afraid to produce goods and services unless they are sure substantial amounts will be purchased. This leads to delays and queues for some products. Tasks: 1. Read the text “Economic systems”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian

Essential Vocabulary available resources

қолжетімді ресурстар

имеющиеся ресурсы

satisfy the demands

сұранысты қанағаттандыру

удовлетворять требования

command economy

топтық экономика

командная экономика

production and consumption

өндіріс жəне тұтыну

производство и потребление

have a number of common біршама ортақ features сипаттарға ие болу

иметь ряд общих черт

the intention

мақсат, ниет

намерения

comply with plans and goals

жоспарлар мен мақсаттарға сай болу

соответствовать планам и целям

to divert resources

ресурстар алу, пайдалану

отвлекать, использовать ресурсы

abandon planned economies

жоспарлы экономикадан отказаться от плановой бас тарту экономики

regard as obsolete

ескірген деп санау

считать устаревшим

overproduced

артық

избыточный

delays and queues

кідірістер мен кезектер

задержки и очереди

to predict changes in demand

сұраныстағы өзгерістерді болжау

предсказывать изменения в спросе

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Answer the following questions: 1. What is an economic system in which businesses operate? 2. Why are planned economies called “command economies”? 3. Is it really so that a planned economy is easy to understand but not simple to operate? Why? 4. What are the main advantages of a planned economy? 5. Are there any disadvantages in planned economies? 6. Can command economies respond to changes in people’s tastes and fashions immediately? 7. Why are planners likely to underproduce goods and services?

The high degree of economic interdependence among today’s economic reflects the historical evolution of the INTERNATIONAL world’s economic and political order. ECONOMY At the end of World War Il, the United States was economically and politically the most powerful nation in the world. It was sometimes stated that when the United States sneezed, the economies of other nations caught a cold. But with the passage of time, the U.S. economy became increasingly integrated into the economic activities of foreign countries. The formation of the European Community during the 1950s, the rise in importance of the multinational corporation during the 1960s, and the market power in world oil markets enjoyed by the Organization of Petroleum Exporting Countries during the 1970s, all resulted in the evolution of the world community into a complicated system based on a growing interdependence among nations. Recognizing that world economic interdependence is complex and its effects uneven, the economic community has made efforts toward international cooperation. Conferences devoted to global economic issues have explored the avenues through which cooperation could be fostered between the industrial and the less developed nations. Interdependence among nations also applies in the case of foreign debt. Throughout the 1970s, the growth of middle-income developing nations was widely viewed as a great success story. Of particular importance was their success in increasing exports of manufactured Text 4

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goods. However, much of this success was due to the availability of loans from industrial nations. Based on overly optimistic expectations about export earnings and interest rates, these nations borrowed excessively to finance growth. Then, with the impact of world recession on export demand, high interest rates, and tumbling oil prices, countries such as Argentina and Mexico found they had to make annual payments of principal and interest that exceeded their total exports of goods and services. The reluctance of creditor nations to lend as much as in the past meant that debtor nations were pressed to cut imports or expand exports, in spite of a worldwide recession. It was recognized that failure to repay the debt could result in a serious disruption of the international financial system. During the past decade, the world’s market economies have become integrated as never before. Exports and imports as a share of national output have reached unprecedented levels for most industrial nations, while foreign investment and international lending have expanded more rapidly than world trade. This closer linkage of economies can be mutually advantageous for trading nations. It permits producers in each nation to take advantage of specialization and economies of large scale production. A nation can consume a wider variety of products at a cost less than which could be achieved in the absence of trade. Despite these advantages, demands have grown for protection against imports. In short, economic interdependence has become a complex issue in recent times, often resulting in strong and uneven impacts among nations and among sectors within a given nation. Business, labor, investors, and consumers all feel the repercussions of changing economic conditions or trade policies in other nations. Today’s global economy requires cooperation on an international level to cope with the myriad issues and problems. Essential Vocabulary economic interdependence экономикалық тəуелділік

экономическая зависимость

the multinational corporation

көпұлтты корпорация

многонациональная корпорация

uneven effects

біркелкі емес əсерлер

неравные эффекты

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to make efforts toward

бірнəрсеге күш салу

делать усилия, направленные на

middle – income developing nations

орта табысты дамушы елдер

развивающиеся страны со средним уровнем доходов

due to the availability of smth

бірнəрсеге қолжетімділік арқасында

благодаря доступности чего-либо

export earnings and interest rates

экспорттан түскен табыс доходы от экспорта и пен пайыздық үстеме процентные ставки

tumbling oil prices

мұнай бағасының ауытқуы

колебание цен на нефть

to repay the debt

қарызды өтеу

погашать задолженность

to feel the repercussions

салдарын сезіну

чувствовать последствия

to take advantage of specialization

мамандықтың артық тұсын пайдалану

воспользоваться специализацией

Tasks: 1. Read the text “International Economy”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What economic and political factors promoted the United States to become the most powerful nation in the world? 2. How will you explain the statement “when the United States sneezed, the economies of other nations caught a cold”? 3. What were the main reasons that led to a growing interdependence among nations? 4. How will you explain the economic development of middle-income developing nations in the 1970s? 5. What enables producers of each nation to take advantage of specialization and economies of large scale production?

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Unit II HISTORY OF ECONOMIC THOUGHTS

The Mercantilists. Between the 16th and 18th centuries, the major countries of Europe believed in the economic theory THE FIRST MODERN of mercantilism. Mercantilists argued ECONOMISTS: THE MERCANTILISTS that nations should behave as if they were AND PHYSIOCRATS merchants competing with one another for profit. Accordingly, governments should support industry by enacting laws designed to keep labor and other production costs low, and exports high. In this way the nation could achieve what was called a “favorable balance of trade”. “Favorable balance of trade” described a situation in which exports exceeded imports. The excess, which was like profits to a merchant, would result in an increase in the nation’s supply of gold or silver. And, as most people agreed in those days, the true measure of a nation’s wealth was its hoard of gold or silver. To achieve favorable trade balances, the major European powers sought to acquire colonies. Colonies, it was thought, could provide the ‘mother country’ with cheap labor, raw materials and a market for its manufactured goods. In an effort to attain these goals in their American colonies, the British, for example, enacted the Navigation Acts. The Navigation Acts protected British industry by prohibiting the colonies from producing certain goods like hats, woolen products and wrought iron. The laws also listed certain “enumerated articles” (mostly raw materials) which could not be sold to buyers in countries other than England. Resentment towards the Navigation Acts was so great that they are regarded as one of the principal causes of the Revolutionary War. Today there are people who still argue that their country should promote a “favorable balance of trade”,that their national government should do what it can to restrict imports and promote exports. For Text 1

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that reason, they are often described as neo-mercantilists or “new” mercantilists. The Physiocrats. For one group of 18th century French philosophers and economists, the suggestion that nations should go out of their way to protect business and industry made no sense at all. These were the physiocrats. The physiocrats argued that the products of agriculture and other natural resources were the true source of wealth. Since these were God-given, it made little sense for government to go out of its way to help business and industry increase profits. For similar reasons, they opposed government efforts to promote a “favorable balance of trade”. In other words, since real wealth came from the land, it followed that the wisest thing government could do, would be to keep its hands off business and let nature take its course. This idea was expressed in the slogan ‘laissez faire’, (let people do as they choose). Interestingly, the 200 year-old argument between those favo-ring regulations of the economy and those supporting laissez faire is still with us. Whether the problem involves individuals (like those living in poverty and unemployment) or institutions (such as a rising tide of business or bank failures), there are those who find the solution in government intervention, and others who favor ‘laissez faire’, letting natural economic forces take their course. Essential Vocabulary to compete for profit

пайда табу мақсатында бəсекеге түсу

конкурировать с целью получения прибыли

to enact laws

заңдар қабылдау

принимать законы

production costs

өндіріс шығындары

производственные затраты

favorable balance of trade қолайлы сауда балансы

положительное сальдо торговли

to exceed imports over exports

импортты экспорттан асыру

превышать импорт над экспортом

to attain goals

мақсатқа қол жеткізу

достигать цели

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to restrict or promote imports (exports)

импортты (экспортты) шектеу немесе арттыру

ограничить или повышать импорт (экспорт)

the true source of wealth

байлықтың қайнар көзі

истинный источник богатства

to keep one’s hands off business

бизнеске араласпау

не вмешиваться в бизнес

Tasks: 1. Read the text “The First Modern Economists: the mercantilists and physiocrats”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh / Russian Answer the following questions: 1. What two economic theories are discussed in the text? 2. How were they different from each other? 3. What is a ‘favorable balance of trade’? 4. What is ‘laissez faire’ and which group is the term associated with? 5. Can you name any individuals or groups of people in your country or abroad who could be described as neo-mercantilists? 6. In the United States today, the opinion about the economic policy continues to be divided into two schools of thought similar to those described in the article. Is this theory applicable in your country? Provide examples to support your opinion. 7. Identify the neo-mercantilists.

1776, the year that Americans associate with the signing of the Declaration of Independence, also marked the publication WORLD’S FAMOUS in England of one of the most influential ECONOMISTS: books of our time, “The Wealth of Nations”, ADAM SMITH AND “THE written by Adam Smith, earned the author WEALTH OF NATIONS” the title “The father of economics”. Smith objected to the principal economic beliefs of his day. He differed from the physiocrats who argued that land was the only source of wealth. He also disagreed with the mercantilists who measured the wealth of a nation by its money supply, and who called for government regulation of the economy in order to promote a “favorable balance of trade”. Text 2

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In Smith’s view, a nation’s wealth was dependent upon production, not agriculture alone. How much it produced, he believed, depended upon how well it combined labor and the other factors of production. The more efficient the combination, the greater the output, and the nation’s wealth. The heart of Smith’s economic philosophy was his belief that the economy would work best if left to function on its own without government regulation. In those circumstances, self – interest would lead business firms to produce only those products that consumers wanted, and to produce them at the lowest possible cost. They would do this, not as a means of benefitting society, but in an effort to outperform their competitors and gain the greatest profit. But all this self interest would benefit society as a whole by providing it with more and better goods and services, at the lowest prices. To explain why all society benefits when the economy is free of regulation, Smith used the metaphor of the “invisible hand”: “Every individual is continually exerting himself to find the most advantageous employment for whatever capital he can command. It is his own advantage, and not that of society, which he has in mind, but he is in advantage, and not that of society, which he has in mind, but he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention, for the pursuit of his own advantage necessarily leads him to prefer that employment which is most advantageous to society”. The “invisible hand” was Smith’s name for the economic forces that we today would call supply and demand, or the marketplace. He sharply disagreed with the mercantilists who, in their quest for a “favorable balance of trade”, called for regulation of the economy. Instead Smith agreed with the physiocrats and their policy of “laissez faire”, letting individuals and businesses function without interference of government regulation or private monopolies. In that way, the “invisible hand” would be free to guide the economy and maximize production. The Wealth of Nations goes on to describe the principal elements of the economic system. In a famous section, Smith turned to the pin industry to demonstrate how the division of labor and the use of machinery increased output. 17

“One man draws out the wire, another straights it, a third cuts, a fourth points it, a fifth grinds it at the top for receiving the head; to make the head requires two or three distinct operations”. Although modern technology has improved the methods by which pins are produced, the principles pertaining to the division of labor remain unchanged. Similarly, other sections dealing with the factor of production, money and international trade are as meaningful today a when they were first written. Smith’s The Wealth of Nations contains some of the best descriptions of the principles upon which the economic system of the United States is based. Essential Vocabulary to object to

бірнəрсеге қарсыболу

возражать против чеголибо

to differ from

ерекшелену

отличаться от

to combine labor and the еңбек жəне өндірістің other factors of production басқа да факторларын біріктіру

объединить труд и другие факторы производства

to exert oneself to do smth біреуді бірнəрсе істеуге мəжбүрлеу

заставить кого-либо сделать что-либо

an effort to outperform one’s competitors

өзінің бəсекелестерін усилия, чтобы превзойти басып озу үшін күш салу своих конкурентов

for the pursuit of one’s pzofit

жеке бас пайдасы үшін

для достижения собственной выгоды

to promote an end with

көздеген мақсатқа қолжеткізуге дем беру

содействовать достижению цели

to be free of regulation

бақылаудан азат болу

быть свободным от регулирования

the principles pertaining to the division of labor

еңбек бөлінісіне қатысты қағидалар

принципы, относящиеся к разделению труда

Tasks: 1. Read the text “Adam Smith and “The Wealth of Nations”.Write and memorize unknown words and word combina-tions. 2. Translate the text into Kazakh/ Russian

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Answer the following questions: 1. What was the correlation between the co – fathers of Declaration of Independence and Adam Smith? 2. Why did Adam Smith object to the principal economic beliefs of his day? 3. Why did he think that the economy would work best without government regulation? 4. What did Adam Smith mean by using the metaphor of the “invisible hand”? 5. How did he describe the principal elements of the economic system in his work “The Wealth of Nations”?

David Ricardo is one of history’s most influential economists. Born in England, CLASSICAL CHAMPION Ricardo made a fortune on the London Stock Exchange. This wealth gave him the OF FREE TRADE: time to write and to serve in Parliament’s DAVID RICARDO (1772-1823) House of Commons. His most famous work Principles of Political Economy and Taxation (1817), marked him as the greatest spokesman for classical economics since Adam Smith. Ricardo is especially famous in international economics for demonstrating the advantages of free trade. Free trade is a policy in which tariffs and other barriers to trade between nations are removed. To prove his point, Ricardo developed a concept we now call the principle of comparative advantage. Comparative advantage enabled him to demonstrate that one nation might profitably import goods from another even through the importing country could produce that item for less than the exporter. Ricardo’s explanation of comparative advantage went as follows: Portugal and England, both of whom produce wine and cloth, are considering the advantages of exchanging those products with one another. Let’s assume that: X barrels of wine are equal to (and therefore trade evenly for) Y yards of cloth. In Portugal 80 workers can produce X barrels of wine in a year. It takes 120 England workers to produce that many barrels. 90 Portuguese workers can produce Y yards of cloth in a year. It takes 100 English workers to produce Y yards of cloth. Text 3

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We can see, Ricardo continued, that even though Portugal can produce both wine and cloth more efficiently than England, it pays them to specialize in the production of wine and import English cloth. This is so because by trading with England, Portugal can obtain as much cloth 80 worker-years as it would take 90 worker-years to produce themselves. England will also benefit. By specializing in cloth, it will be able to obtain wine in exchange for 100 worker years of labor rather than 120. As a Member of Parliament, Ricardo pressed the government to abandon its traditional policy of protection. Though he did not live to achieve that goal, his efforts bore fruit in the 1840’s when England became the first industrial power to adopt a policy of free trade. There followed 70 years of economic growth during which the nation became the world’s wealthiest industrial power. Essential Vocabulary to make a fortune to demonstrate the advantages to adopt a policy of free trade to remove barriers to be equal to to press the government to abandon the policy of protection to become an industrial power to bear fruit

байып кету, баю жақсы жағын / артықшылығын көрсету еркін сауда саясатын қабылдау кедергілерді алып тастау

сколотить состояние показать преимущества принять политику свободной торговли устранить препятствия тең болу быть равным с үкіметке күш / қысым оказывать давление на көрсету правительство протекционизм саясаты- отказаться от политики нан бас тарту протекционизма өнеркəсібі дамыған дер- стать индустриально жаваға айналу развитой державой жемісін беру приносить плоды

Tasks: 1. Read the text “Classical Champion of Free Trade”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian

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Answer the following questions: 1. Where did David Ricardo make his fortune as an economist? 2. Do you know his work Principles of Political Economy and Taxation? 3. What was his contribution to demonstrating the advantages of free trade? 4. What did he want to show by the explanation of comparative advantage in exchanging products? 5. Was Ricardo a success in making the government to abandon the traditional policy of protection?

John Maynard Keynes (rhymes with “brains”) stands with Adam Smith and Karl Marx as one of the world’s most THEORIST WHO influential economists. The son of a noted BROUGHT ECONOMICS British economist, Keynes amassed a INTO THE TWENTIETH fortune through speculation in stocks CENTURY: and commodities. He served the British JOHN MAYNARD government as a financial adviser and KEYNES (1883-1946) treasury official through most of his adult life and was a key participant in the negotiations following both World Wars I and II. Although Adam Smith had written “The Wealth of Nations” about the time of the American Revolution, by the 1930s little had changed in the thinking of main-stream economists. Most would have agreed with Smith, that the best thing government could do to help the economy would be to keep its hand off. They reasoned that as long as the economy was free to operate without interference, the forces of supply and demand would come into balance. Then, with total supply and demand in equilibrium, everyone looking for work could find a job at the prevailing wage, and every firm could sell its products at the market price. But the 1930s was the period of the Great Depression. Despite the assurances of the classical economists, the fact was that unemployment and business failure had reached record proportions in the United States and the rest of the industrialized world. It was at this time (1936) that Keynes’ “General Theory of Employment, Interest, and Money” was published. The General Theory transformed economic thinking in the 20th century, much the way that “The Wealth of Nations” had in the 18th. Text 4

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Keynes demonstrated that it was possible for total supply and demand to be at equilibrium at a point well under full employment. What is more, Keynes demonstrated that unemployment could persist indefinitely, unless someone stepped in to increase total demand. The “someone” Keynes had in mind was government. He reasoned that if, for example, government spent money on public works, the income received by formerly idle workers would lead to increased demand, a resurgence of business activity and the restoration of full employment. The suggestion that government abandon laissez faire in favor of an active role in economic stabilization was regarded as revolutionary in the 1930s. Since then, however, the ideas advanced by the “Keynesian Revolution” have become part of conventional wisdom. Now, whenever a nation appears to be entering into a period of recession or inflation, economists and others immediately think of steps the government might take to reverse the trend. Essential Vocabulary to amass a fortune

табысқа қол жеткізу

добиться успеха

to operate without interference

еш (сыртқы) кедергісіз əрекет ету

действовать без вмешательства (со стороны)

a job at the prevailing wage

жоғары жалақылы жұмыс

работа на солидную зарплату

despite the assurances

сенімділікке қарамастан

несмотря на убежденность

to transform economic thinking

экономикалық көзқарасты өзгерту

менять экономическое мышление

under full employment

толық жұмыспен қамтылған жағдайда

при полной занятости

a resurgence of business activity

бизнес əрекеттерін қалпына келтіру

восстановление бизнесактивности

conventional wisdom

парасатты ой-сана

здравый смысл

a period of recession

құлдырау кезеңі

период спада

to reverse the trend

үдерісті кері бұру

повернуть процесс обратно

to abandon laissez faire

қол сұғушылықтан / араласудан бас тарту

отказаться от вмешательства

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Tasks: 1. Read the text “Theorist Who Brought Economics into the Twentieth Century”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. Why is John Maynard Keynes placed among the influential economists? 2. What was his contribution to the British government? 3. How would you explain the statement “the farther the government keeps its hands off, the better the economic situation”? 4. What were the main reasons of the Great Depression in the US and the rest of the industrialized world? 5. What is the correlation between the total supply and demand and full employment?

Capitalism, as its name suggests, is based on the ownership of Capital. What is capital? Basically, capital is anything MARXIST METHODS that can be traded for something else. OF ANALYSIS Any amount of money is capital, as it can be traded for a huge variety of things. Personal items are also capital because they can be sold; houses, cars, and other bizarre items fall under this category. The ability to work can also be considered capital, or labour-power. Karl Marx first posited that perhaps there was something that separated capital into two broad categories. Some capital is bought, and then the value is fixed; this applies for an item of clothing or food, for instance. Some may lose value and depreciate; cars fall into this category. Some capital, however, can actually produce more capital which can then be sold; this, he argued, is real capital. For example, if you have a cookie-stamper and a van, some flour, butter, and other cookie ingredients, with that capital, you could produce cookies and ship them around in the van selling them for a profit, albeit small. Marxism is a worldview and method of societal analysis that focuses on class relations and societal conflict, that uses a materialist interpretation of historical development, and a dialectical view of social transformation. Marxist methodology uses economic and sociopolitical inquiry and applies that to the analysis and critique of Text 5

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the development of capitalism and the role of class struggle in systemic economic change. In the mid-to-late 19th century, the intellectual tenets of Marxism were inspired by two German philosophers: Karl Marx and Friedrich Engels. Marxist analyses and methodologies have influenced multiple political ideologies and social movements. Marxism encompasses an economic theory, a sociological theory, a philosophical method, and a revolutionary view of social change. Marxism has developed into different branches and schools of thought. Different schools place a greater emphasis on certain aspects of classical Marxism while de-emphasizing or rejecting other aspects of Marxism, sometimes combining Marxist analysis with non-Marxian concepts. Some variants of Marxism primarily focus on one aspect of Marxism as the determining force in social development – such as the mode of production, class, power-relationships or property ownership – while arguing other aspects are less important or current research makes them irrelevant. Despite sharing similar premises, different schools of Marxism might reach contradictory conclusions from each other. For instance, different Marxian economists have contradictory explanations of economic crisis and different predictions for the outcome of such crises. Furthermore, different variants of Marxism apply Marxist analysis to study different aspects of society (e.g. mass culture, economic crises, or feminism). Marx considered these socio-economic conflicts as the driving force of human historу since these recurring conflicts have manifested themselves as distinct transitional stages of development in Western Europe. Accordingly Marx designates human history as encompassing four stages of development in relations of production. Primitive Communism: as in co-operative tribal societies. Slave Society: a development of tribal to city-state; aristocracy is born. Feudalism: aristocrats are the ruling class; merchants evolve into capitalists. 4.Capitalism:capitalists are the ruling class, who create and employ the proletariat. Marxist understandings of history and of society have been adopted by academics in the disciplines of archaeology and anthropology, media studies, political science, theater, history, sociology, art history 24

and art theory, cultural studies, education, economics, geography, literary criticism, aesthetics, critical psychology, and philosophy. The pursuit and realization of profit is an essential characteristic of capitalism. Profit is derived by selling a product for more than the cost required to produce or acquire it. Some consider the pursuit of profit to be the essence of capitalism. Sociologist and economist, Max Weber, says that “capitalism is identical with the pursuit of profit, and forever renewed profit, by means of conscious, rational, capitalistic enterprise”. However, it is not a unique characteristic for capitalism, some practiced profitable barter and monetary profit has been known since antiquity. Opponents of capitalism often protest that private owners of capital do not remunerate laborers the full value of their production but keep a portion as profit, claiming this to be exploitative. However, defenders of capitalism argue that when a worker is paid the wage for which he agreed to work, there is no exploitation, especially in a free market where no one else is making an offer more desirable to the worker; that “the full value of a worker’s production” is based on his work, not on how much profit is created, something that depends almost entirely on factors that are independent of the worker’s performance; that profit is a critical measure of how much value is created by the production process; that the private owners are the ones who should decide how much of the profit is to be used to increase the compensation of the workers (which they often do, as bonuses); and that profit provides the capital for further growth and innovation. Essential Vocabulary to be based on smth

бірнəрсеге негізделу

основываться, базироваться на чем-то

to lose value

құндылығын жоғалту

терять ценность

to sell smth for a profit

бірнəрсені пайда табу үшін сату

продавать что-то для получения прибыли

to focus on onclass relations

таптан тыс қатынастарға ерекше назар аудару

акцентировать внимание на надклассовые отношения

to encompass

жүзеге асыру

осуществлять

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the mode of production

өндіріс əдісі

способ производства

to reach contradictory conclusions

қарама-қайшы тұжырым жасау

прийти (делать) противоречивые выводы

to make predictions of the outcome of crises

дағдарыстың нəтижесін болжау

предсказывать исход кризисов

to derive profit

пайда табу

извлекать прибыль

to remunerate the full value of

толық құнын төлеу, есесін қайтару

компенсировать, оплачивать полную стоимость

to be independent of one’s performance

еңбек нəтижесіне тəуелді болмау

не зависеть от результата труда

Tasks: 1. Read the text “Marxist methods of analysis”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What is capital? 2. Сan personal items be considered as capital? 3. Is Marxist methodology still used in the economic and socio-political fields? 4. What four stages of development in relations of production were described in the Marxist theories? 5. Speak on the two different approaches of opponents and proponents to capitalism?

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Unit ІІІ MICROECONOMICS

Microeconomics, like macroeconomics, is a fundamental method for analyzing the economy as a system. It MICROECONOMICS AS A SYSTEM treats households and firms interacting through individual markets as irreducible elements of the economy, given scarcity and government regulation. A market might be for a product, say fresh corn, or the services of a factor of production, say bricklaying. The theory considers aggregates of quantity demanded by buyers and quantity supplied by sellers at each possible price per unit. It combines these together to describe how the market may reach equilibrium as to price and quantity or respond to market changes over time. Such analysis includes the theory of supply and demand. It also examines market structures, such as perfect competition and monopoly for implications as to behavior and economic efficiency. Analysis of change in a single market often proceeds from the simplifying assumption that relations in other markets remain unchanged, that is, partial-equilibrium analysis. General-equilibrium theory allows for changes in different markets and aggregates across all markets, including their movements and interactions toward equilibrium. Here economists distinguish between Production theories, Opportunity cost, Economic efficiency, and Production-possibility frontier. In microeconomics, production is the conversion of inputs into outputs. It is an economic process that uses inputs to create a commodity for exchange or direct use. Production is a flow and thus a rate of output per period of time. Distinctions include such production alternatives as for consumption (food, haircuts, etc.) vs. investment goods (new tractors, buildings, roads, etc.), public goods (national defense, small-pox vaccinations, etc.) or private goods (new computers, bananas, etc.), and “guns” vs. “butter”. Opportunity cost refers to the economic cost of production: the value of the next best opportunity foregone. Choices must be made Text 1

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between desirable yet mutually exclusive actions. It has been described as expressing “the basic relationship between scarcity and choice” The opportunity cost of an activity is an element in ensuring that scarce resources are used efficiently, such that the cost is weighed against the value of that activity in deciding on more or less of it. Opportunity costs are not restricted to monetary or financial costs but could be measured by the real cost of output forgone, leisure, or anything else that provides the alternative benefit. Inputs used in the production process include such primary factors of production as labour services, capital (durable produced goods used in production, such as an existing factory), and land (including natural resources). Other inputs may include intermediate goods used in production of final goods, such as the steel in a new car. Economic efficiency describes how well a system generates desired output with a given set of inputs and available technology. Efficiency is improved if more output is generated without changing inputs, or in other words, the amount of “waste” is reduced. A widely-accepted general standard is Pareto efficiency, which is reached when no further change can make someone better off without making someone else worse off. Essential Vocabulary irreducible elements

азаймайтын элементтер

неиссякаемые ресурсы

price per unit

бірлікке шаққандағы құны / бағасы

цена за единицу

to respond to market changes

нарық өзгерістерін сезіну

реагировать на рыночные изменения

to simplify smth

бірнəрсені жеңілдету

упрощать что-либо

input and output

кіріс пен шығыс

ввод и выход

mutually exclusive action

өзара жоққа шығаратын əрекеттер

взаимноисключающие действия

to use scarce resources

мардымсыз /аз ресурстарды пайдалану

использовать скудные ресурсы

scarcity and choice

жетіспеушілік жəне таңдау

дефицит (нехватка) и выбор

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monetary costs

қаржылық-валюталық шығындар

валютно-денежные расходы

durable goods

ұзақ мерзім қолданылатын тауарлар

товары длительного использования

to improve efficiency

өнімділікті арттыру / жақсарту

улучшать, повышать производительность

Tasks: 1. Read the text “Microeconomics”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What is microeconomics? 2. What does economic efficiency describe? 3. What is production? 4. How can a market reach equilibrium? 5. What do factors of production include?

Founders of companies have to write a Memorandum of Association (in the US, a Certificate of Incorporation), which states FOUNDING A the company’s name, purpose, registered COMPANY office or premises and authorized share capital. Premises (always with a ‘s’at the end) – is the technical term for the place in which a company does its business: an office, a shop, a workshop, a factory, a warehouse, etc. Authorized share capital means the maximum amount of a particular type of share the company can issue. Founders also write Articles of Association (US = Bylaws), which set out the rights and duties of directors and different classes of shareholders. Companies’ memoranda and articles of association, and annual financial statements are sent to the registrar of companies, where they may be inspected by the public. A company that files its financial statements late is almost certainly in trouble.) In Britain, founders can buy a ready-made “off-the-shelf” company from an Text 2

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agent, that is, a company formed and held specifically for later resale; the buyer then changes the name, memorandum, and so on. Every organization made up of more than one person will need some form of organizational structure. The way in which a company is organized can be illustrated for a packaging company. The company will be owned by shareholders that choose directors to look after their interests. The directors then appoint managers to run the business on a day-to-day basis. The Managing Director has the major responsibility for running of the company, including setting company targets and keeping an eye on all departments. The Distribution Manager is responsible for controlling the movement of goods in and out of the warehouse, supervising drivers and overseeing the transport of goods to and from the firm. The Production Manager is responsible for keeping a continuous supply of work flowing to all production staff and also for organizing manpower to meet the customers’ orders. The Sales Manager is responsible for making contact with customers and obtaining orders from those contacts. The Company Accountant controls all the financial dealings of the company and is responsible for producing management accounts and financial reports. Other organizations will have different structures. For example most organizations will have a marketing department responsible for market research and marketing planning. A customer services department will look after customer requirements. A human resources department will be responsible for recruitment and selection of new employees, employee motivation and a range of other people focused activities. In addition there will be a number of cross-functional areas such as administration and Information Technology departments that service the functional areas of the company. These departments will provide back up support and training. Organizations are structured in different ways: 1. by function as described above; 2. by regional area - a geographical structure e.g. with a marketing manager North, marketing manager South etc., 3. by product e.g. marketing manager crisps, marketing manager drinks, etc., 30

4. into work teams, etc. Reporting in organizations often takes place down the line. An employee might be accountable to a supervisor, who is accountable to a junior manager, who is then accountable to a senior manager – communication and instructions can then be passed down the line. Essential Vocabulary founders

негізін салушылар

основатели

different classes of shareholders

акционерлердің əртүрлі топтары

различные классы акционеров

to be in trouble

қиын жағдайда болу

быть в затруднении

to run the business

бизнесті басқару / жүргізу

управлять, вести бизнес

to have the major responsibility

басты жауапкершілікті алу

нести главную ответственность

to set targets

мақсат пен міндеттер қою

ставить цели и задачи

to control the movement of goods in and out

кіргізетін жəне шығаратын тауарлар қозғалысын реттеу / бақылау

контролировать движение входящих и исходящих товаров

to meet the customers’ orders

тұтынушы выполнять заказы тапсырыстарын орындау клиентов

to obtain orders from customers

тұтынушыдан тапсырыс получать заказы от алу клиентов

financial dealings of the company

компанияның қаржы операциялары

финансовые операции, сделки компании

a human resources department

кадрлар бөлімі

отдел кадров

Tasks: 1.Read the text “Founding a Company”. Write and memorize unknown words and word combinations. 2.Translate the text into Kazakh/ Russian

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Answer the following questions: 1. What do founder of companies have to do in order to be registered as an organizational structure? 2. What is the difference between shareholder and stockholder? 3. What are the major functions of the Company Accountant and a customer services department? 4. What is a human resources department responsible for? 5. How are organizations structured by in order to provide back up support and training?

The Standard Oil Company founded by John D. Rockefeller and the U.S. Steel Company founded by Andrew Carnegie. CORPORATE DEVELOPMENT DURING The Standard Oil Company and U.S. THE INDUSTRIAL Steel Company were made successful in REVOLUTION different ways due to the actions of their different owners. The companies differed in their labor relations, market control, and structural organization. In the steel industry, Carnegie developed a system known as vertical integration. This means that he cut out the middle man. Carnegie bought his own iron and coal mines because using independent companies cost too much and was inefficient. By doing this he was able to undersell his competitors because they had to pay the competitors they went through to get the raw materials. Unlike Andrew Carnegie, John D. Rockefeller integrated his oil business from top to bottom; his distinctive innovation in movement of American industry was horizontal. This meant he followed one product through all its stages. For example, Rockefeller controlled the oil when it was drilled, through the refining stage, and he maintained control over the refining process turning it into gasoline. Although these two powerful men used two different methods of management their businesses were still very successful. Tycoons like Andrew Carnegie, the steel king, and John D. Rockefeller, the oil baron, exercised their genius in devising ways to circumvent competition. Although, Carnegie inclined to be toughfisted in business, he was not a monopolist and disliked monopolistic trusts. John D. Rockefeller came to dominate the oil industry. With one Text 3

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upward stride after another he organized the Standard Oil Company, which was the nucleus of the great trust that was formed. Rockefeller showed little mercy. He believed primitive savagery prevailed in the jungle world of business, where only the fittest survived. He pursued the policy of ruin or rule. Rockefeller’s oil monopoly did turn out a superior product at a relatively cheap price. Rockefeller believed in ruthless business, Carnegie didn’t, yet they both had the most successful companies in their industries. Rockefeller treated his customers in the same manner that Andrew Carnegie treated his workers: cruel and harsh. The Standard Oil Company desperately wanted every possible company to buy their products. Standard Oil used ruthless tactics when Rockefeller threatened to start his own chain of grocery stores and put local merchants out of business if they did not buy oil from Standard Oil Company. Carnegie dealt with his workers with the same cold lack of diplomacy and consideration. Carnegie would encourage an unfriendly competition between two of his workers and he goaded them into outdoing one another. Some of his employees found working under Carnegie unbearable. These rivalries became so important to the employees that some didn’t talk to each other for years. Although both Carnegie and Rockefeller created extremely successful companies, they both used unscrupulous methods in some aspect of their corporation building to get to the top. The success of the Standard Oil Company and U.S. Steel company was credited to the fact that their owners ran them with great authority. In this very competitive time period, many new businesses were being formed and it took talented businessmen to get ahead and keep the companies running and make the fortunes that were made during this stage of development. Essential Vocabulary to be a success

табысқа қол жеткізу

добиться успеха

to differ in labor relations

еңбек қатынастарында ерекшелену

отличаться в процессе трудовых отношений

to cost much and be inefficient

бағасы қымбат болу жəне тиімсіз болу

стоить дорого и быть неэффективным

to get the raw materials

шикізат алу

получать сырье

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to follow the product through all its stages

өнімді өндірудің барлық проследить процесс кезеңдерін қадағалау производства через все этапы

to treat customers

тұтынушылармен қарым-қатынас жасау

относиться к клиенту

the oil refining process

мұнай өңдеу үдерісі

нефтеперерабатывающий процесс

to use ruthless tactics

қатаң тактика қолдану

применять жесткую тактику

to encourage unfriendly competition

араз бəсекелестікке қолдау көрсету

поощрять недружелюбную конкуренцию

to goad smb

біреуді қыздыру / жігерлендіру

подгонять кого-то, пришпоривать

to use unscrupulous methods

принципсіз, жауапсыз тəсілдер қолдану

использовать беспринципные, недобросовестные методы

Tasks: 1. Read the text “Corporate development during the industrial revolution”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What does a vertical integration system mean? 2. What was the peculiar feature of using a horizontal system? 3. What was the secret of success of two powerful men who used two different methods of management? 4. What was the main idea of Rockefeller’s management style? 5. Do you support the idea that if you want to be a success, you should use unscrupulous methods in your business?

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A market is any one of a variety of systems, institutions, procedures, social relations and infrastructures whereby MARKET businesses sell their goods, services and labour to people in exchange for money. Goods and services are sold using a legal tender such as fiat money. This activity forms part of the economy. It is an arrangement that allows buyers and sellers to exchange items. Competition is essential in markets, and separates market from trade. Two persons may trade, but it takes at least three persons to have a market, so that there is competition on at least one of its two sides. Markets vary in size, range, geographic scale, location, types and variety of human communities, as well as the types of goods and services traded. Some examples include local farmers’ markets held in town squares or parking lots, shopping centers and shopping malls, international currency and commodity markets, legally created markets such as for pollution permits, and illegal markets such as the market for illicit drugs. In mainstream economics, the concept of a market is any structure that allows buyers and sellers to exchange any type of goods, services and information. The exchange of goods or services for money is a transaction. Market participants consist of all the buyers and sellers of a good who influence its price. This influence is a major study of economics and has given rise to several theories and models concerning the basic market forces of supply and demand. There are two roles in markets, buyers and sellers. The market facilitates trade and enables the distribution and allocation of resources in a society. Markets allow any tradable item to be evaluated and priced. A market emerges more or less spontaneously or is constructed deliberately by human interaction in order to enable the exchange of rights of services and goods. Historically, markets originated in physical marketplaces which would often develop into – or from – small communities, towns and cities. A market can be organized as an auction, as a private electronic market, as a commodity wholesale market, as a shopping center, as a complex institution such as a stock market, and as an informal discussion between two individuals. Text 4

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Markets of varying types can spontaneously arise whenever a party has interest in a good or service that some other party can provide. Hence there can be a market for cigarettes in correctional facilities, another for chewing gum in a playground, and yet another for contracts for the future delivery of a commodity. There can be black markets, where a good is exchanged illegally and virtual markets, such as eBay, in which buyers and sellers do not physically interact during negotiation. There can also be markets for goods under a command economy despite pressure to repress them. Essential Vocabulary to sell goods and services

тауарлар мен қызметтерді сату

продавать товар и услуги

in exchange for smth

бірнəрсеге айырбас ретінде

в обмен на что-либо

local markets

жергілікті нарық

местные рынки

to influence prices

бағаға əсер ету

влиять на цены

supply and demand

сұраныс пен ұсыныс

спрос и предложение

to enable the distribution and allocation of smth

бірнəрсені үлестіру / тарату жəне орналастыруға мүмкіндік жасау

делать возможным распределение и размещение чего-либо

to facilitate trade

сауда жасауға септігін тигізу

содействовать торговле

to emerge spontaneously

бір уақытта пайда болу

возникать одновременно

a wholesale market

көтерме сауда

оптовый рынок

the delivery of a commodity

тауарды / тұтыну затын жеткізу

доставка товара, предмета потребления

to interact during negotiations

келіссөздер барысында өзара əрекет жасау

взаимодействовать во время переговоров

Tasks: 1. Read the text “Market”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian

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Answer the following questions: 1. What is a market? 2. Can you give the differences between market and trade? 3. Who plays the major roles and influences prices in markets? 4. Dwell upon the types of markets. 5. Why is it so important to study theories and models of markets as a major part of economics? 6. How markets allow any tradable item to evaluated and priced? 7. What do you know about markets under a command economy?

The market is the place where buyers and sellers go to buy and sell. The name comes of course from those gatherings of THE MARKET PLACE people in towns, but today markets don’t need to be physical. Not only can you have electronic marketplaces such as eBay, markets are also seen as the congregation of all people buying and selling things everywhere. This is usually named “the market” and referenced to as it is a thing with a will and a power of it’s own. But of course, it is just the average will and opinion of all the buyers and sellers, the actors, on the market that shows itself by prices rising and falling and money moving around. Setting a price. An object’s value is not something fixed, but instead a subjective property of the object. This subjectivity may be a bit surprising, it is easy to imagine that something must have an objective worth being bought and sold. However this is not the case, in fact, it’s the opposite. When somebody has an item to sell, he puts a value on this item, and will not sell under that value. Likewise, when somebody wants to buy something, he will put a value on the object, and will not pay more than this. If these valuations overlap, so that the buyer’s valuation is higher than the seller’s valuation, the object will be sold. If the seller’s valuation is higher than the buyer’s, the buyer will simply say “it’s not worth it” or the seller will say “it’s worth more than that” and no deal will be made. Of course, you don’t haggle about price every time you buy a candy bar, but you still agree on a price. It’s just that the store owner has put up a sign with a price, and you can either accept it or reject it. Neither you nor he wants to haggle about something that just costs Text 5

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eighty cents, because it’s simply not worth the effort. So even though haggling is not a necessary part of the pricing, both the buyer and seller agree on the price, and both think they are better off after the exchange. Think about this: If you would think you would be worse off after buying something, would you buy it? Of course not, so buying and selling is an act done by free will. (Unless of course somebody is pointing a gun at you, but then it’s not buying and selling, but stealing.) Now, we know that the price ends up somewhere between the seller’s valuation of the item and the buyer’s valuation of the item. The question of what the price of an item will be therefore depends on these valuations. What, then will these valuations depend on? So as you see, if an object had an intrinsic, objective worth, and both seller and buyer were aware of it, the buyer’s and seller’s valuation of the object would never overlap, and no deal would ever be cut, because the seller would never be willing to sell it at a price less than the objective worth [or else he would be in loss] and the buyer would never be willing to buy it at a cost higher than the objective worth [why would he?], and hence, nobody would ever sell or buy anything. The subjectiveness of value is necessary for things to be sold and bought at all. Free and Regulated markets. The description above is of a free market, where anyone can buy and sell, and where price is set by buyer and seller alone. This is not always the case. Instead many markets are regulated, to limit either the people involved or the prices or both. For example, not everyone is allowed to sell medicine, claim to be a doctor or drive a taxi. The goverment has to approve you in one way or another to make sure you know your job and are not a danger to others. In the same way, not everybody is allowed to buy firearms. You need a clean criminal record and, in most countries, you need to show you know how to use a firearm safely. In some cases the prices are regulated by the government. In some European countries rents are controlled by the government to prevent what is perceived as overcharging. Of course, it can be said today that all markets are regulated in some way. You are, for example, not allowed to use violence, break agreements or steal. But the state setting up the rules for making the market function smoothly is not usually seen as making the market non-free. 38

Supply and Demand. The principle of supply and demand is one of the best-known principles of economic theory. It was first posited by Jean-Baptiste Say, an 18th-century Classical Political Economist who suggested that demand and supply are interrelated. His theory was that the higher demand there is for something, the more people want it. The more that people want it (the more they value it), the more they are willing to pay for it. For example: There are 100 dolls and 400 people that want those dolls. Since there are more people that want dolls than there are dolls, people will pay more money for them. Alfred Marshall, a famous neoclassical economist, went further in the mid-20th century and developed a mathematical model of supply and demand. The two variables in this theory are price and quantity. Essential Vocabulary the congregation of people адамдар жиыны / жиылысы

собрание, скопище людей

to set a price

бағасын белгілеу, бағалау

назначать цену, оценивать

to put a value on the object

заттың құнын бағалау

оценить предмет

to haggle about smth

саудаласу

торговаться

to be better off (to be worse off)

жеңу (жеңілу)

выиграть (проиграть)

to depend on the valuations

бағаға тəуелді болу

зависеть от оценки

an intrinsic worth

ішкі құндылық

внутренняя ценность

to set up rules

ережелер орнату

устанавливать правила

to be a danger to smb

біреуге қауіп төндіру

представлять опасность кому-либо

to make the market function smoothly

нарықтың қалыпты жұмыс жасауына дем беру

содействовать нормальному функционированию рынка

to be willing (to be reluctant) to pay for smth

бірнəрсе үшін ақы төлеуге дайын болу (қаламау)

быть готовым (не желать) заплатить за что-то

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Tasks: 1. Read the text “The Market Place”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. How does the market display itself? 2. What happens if the seller’s valuation is higher than the buyer’s? 3. Do people haggle about price every time when they buy something? 4. Why do we say so that buying and selling is an act done by free will? 5. What will happen if an item had an intrinsic, objective worth? 6. Speak on the positive sides of regulated markets. 7. Have you ever read anything about a mathematical model of supply and demand by Alfred Marshall?

What is Value? Value is the worth of goods and services as determined by markets. Thus an important part of VALUE, WORTH AND Economics is the study of policies and UTILITY activities for the generation and transfer of Value within markets in the form of goods and services. Often a measure for the worth of goods and services is units of currency such as the US Dollar. But, unlike the units of measurements in Physics such as Seconds for Time, there exists no absolute basis for standardizing the units for Value. Usually the value of a currency is related to the value of Gold, which in turn is valued by amount or number of goods and services that it can be exchanged for. Because the rate of production of gold in the world is slower than the rate of creation of goods and services, the relation between gold and currencies is not as strict as it used to be. Thus, one of the most complicated and most often misunderstood parts of economy is the concept of value. One of the big problems is the large number of different types of values that seem to exist, such as exchangevalue, surplus-value, use-value. The buyer’s utility.The discussion of values all start with one simple question: What is something worth? Today’s most common answer is one of those answers that are so deceptively simple that it seems obvious when you know it. But then Text 6

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remember that it took economists more than a hundred years to figure it out: Something is worth whatever you think it is worth. “Something is only worth what someone is willing to pay for it” quote Jonathan Reeves. This statement needs some explanation. Take as an example two companies that are thinking of buying a new copying machine. One company does not think they will use a copying machine that much, but the other knows it will copy a lot of papers. This second company will be prepared to pay more for a copying machine than the first one. They find different utility in the object. The companies also have a choice of models. The first company knows that many of the papers will need to be copied on both sides. The second company knows that very few of the papers it copies will need double sided copying. Of course, the second company will not pay much more for this, while the first company will. In this example, we see that a buyer will be prepared to pay more for the increase in utility compared to alternative products. So we can summarize this with the statement that the economic value of an item is set by the increase in the customer’s utility. This increase in utility is called marginal utility, and this is all known as the Marginal theory of value. The seller’s utility. But how does the seller value things? Well, in pretty much the same way. Of course, most sellers today do not intend to use the object he sells himself. The utility for the seller is not as an object of usage, but as a source of income. And here again it is marginal utility that comes in. For which price can you sell the object? If you put in some more work, can you get a higher price? Here we also get into the resellers utility. Somebody who deals in trading will look at an object, and the utility for him is to be able to sell it again. How much work will it take, and what margins are possible? Essential Vocabulary to be determined by markets

нарықтың өзімен анықталу / тұрақталу

to be valued by amount of тауар жəне қызмет goods and services көлемімен бағалану

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определяться самим рынком определять объемом товара и услуг

the rate of creation of smth

бірнəрсенің құрылу қарқыны

темпы создания чеголибо

the increase in utility

пайдалылығының артуы повышение полезности

to seem deceptively simple

жалған / қарапайым болып көріну

казаться обманчиво простым

a source of income

табыс көзі

источник дохода

marginal utility

шексіз тиімділік

предельная полезность

surplus value

қосымша құн / баға

прибавочная стоимость

the value of a currency

валюта құны / валютаның сатып алу күші

покупательная сила (способность) валюты

value added tax

қосымша құн салығы

налог на добавленную стоимость

the unit of measurements

өлшем бірлігі

единица измерения

Tasks: 1. Read the text “ Value, worth and utility”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What is value? 2. Why is the concept of value considered to be one of the most complicated and most often misunderstood parts of economy? 3. Try to find some information about surplus-value and use-value and dwell upon it. 4. How will you explain the quotation of Jonathan Reeves? 5. How does the seller value things? 6. What is utility for someone who deals in trading? 7. In what cases is a buyer willing to pay more?

In ordinary usage, price is the quantity of payment or com-pensation given by one party to another in return for goods or PRICE services. In all modern economies, the overwhelming majority of prices are quoted in (and the transactions involve) units of some form of Text 7

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currency. Although in theory, prices could be quoted as quantities of other goods or services, this sort of barter exchange is rarely seen. Price can sometimes alternatively refer to the quantity of payment requested by a seller of goods or services, rather than the eventual payment amount. This requested amount is often called the asking price or selling price, while the actual payment may be called the transaction price or traded price. Likewise, the bid price or buying price is the quantity of payment offered by a buyer of goods or services, although this meaning is more common in asset or financial markets than in consumer markets. Economists sometimes define price in a more general or abstract sense to the widely understood definition above. According to this view, price is defined as the ratio between the quantity of goods that are exchanged for each other in a transaction. For example, consider the case of two people exchanging goods; say 5 apples for 2 loaves of bread. An economist might say that the price of apples was 2/5 = 0.4 loaves of bread. Likewise, the price of bread would be 5/2 = 2.5 apples. Hence if we consider that currency is simply another type of good like apples or bread, then this conception forms the general case of the widely held definition outlined above. However it is far from clear that this generalization serves any useful purpose at all. As noted above, in all real economies prices are virtually always quoted in (and transactions always involve) units of currency. Hence, an alternative view is that the most basic and general definition of price is that involving exchange of goods or services for money, and that the exchange ratio between two goods is simply derived from the two individual prices. The exchange ratio is sometimes referred to as the real price, while the price quoted in money referred to as the nominal price. This distinction is sometimes made to make sense of inflation. When all prices are quoted in terms of money units, and the prices in money units change more or less proportionately, the ratio of exchange may not change much. In the extreme case, if all prices quoted in money change in the same proportion, the relative price remains the same. It is now becoming clear that the distinction is not useful and indeed hides a major confusion. The conventional wisdom is that proportional change in all nominal prices does not affect real price, 43

and hence should not affect either demand or supply and therefore also should not affect output. The new criticism is that the crucial question is why is there more money to pay for the same old real output. If this question is answered, it will show that dynamically, even as the real price remains exactly the same, output in real terms can change, just because additional money allow additional output to be traded. The supply curve can shift such that at the old price, the new higher output is sold. This shift if not possible without additional money. From this point of view, a price is similar to an opportunity cost, that is, what must be given up in exchange for the good or service that is being purchased. For example, if x=1 and y=2, the relative price of x in terms of y is 2, and the price of y in terms of x is 0.5. Essential Vocabulary to quote prices

бағаларды бекіту

назначать цены

to involve the exchange of goods and services for money

тауар мен қызметті ақшаға айырбастау

включать обмен товара или услуг на деньги

to hide a major confusion

басты кедергіні жасыру

скрывать основное замешательство, недоразумение

to change more or less proportionately

азды-көпті тең мөлшерде өзгеру

меняться более и менее пропорционально

to affect neither demand nor supply

сұранысқа да, ұсынысқа не влиять ни на спрос, да əсер етпеу ни на предложение

price ratio or plateau

бағалардың арасалмағы

соотношение цен

the supply curve

ұсыныс қисығы

кривая предложения

in the extreme case

ең болмағанда, тым болмағанда

в крайнем случае

to put the crucial question шешуші сұрақ қою

ставить решающий вопрос

to define as ratio between

арасындағы арасалмақты анықтау

определять как соотношение между

barter exchange

баспа-бас айырбас

бартерный обмен

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Tasks: 1. Read the text “Leadership Styles”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian. Answer the following questions: 1. How is price defined in ordinary usage? 2. What is the relationship between prices and consumer demand? 3. Who may offer discounts: the producer or the distributor? 4. How is the reduction of price in return for bulk sales called? 5. What is the relation between real price and the supply? 6. Imagine you own a food store. Your competitor from a nearby food store decreased the price for the same food products by 2%. What can you do not to lose your customers?

Marketing is the process of identifying, anticipating and then meeting the needs and requirements of consumers in order to MARKETING make a profit. In contrast, selling involves AND SALES persuading customers that your products or services provide the benefits that they are looking for. You can therefore see that there is an important difference between marketing and sales. Marketing puts the needs of the customer first. Through market research, it is possible to find out customer tastes and requirements. In contrast selling takes place after marketing has helped the business to identify those sorts of goods that customers are looking for. The sales person is convinced that theirs is the best in the market. It is their job to then convince customers that this is the case. The marketing department of a firm that produces razors like BIC or Gillette carries out research to find out the sorts of shaving developments that their customers are looking for. They ask customers to tell them what improvements they would like to see to existing products and what new products they would like develop. They test a range of possible products on customers. As a result of the marketing process they are able to come up with the most suitable products. Having invested so much in customer focused marketing they must then sell the benefits of the new product developments to customers. Text 8

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This involves advertising and promotion to communicate product benefits. It involves providing the appropriate support literature and direct selling to retail outlets that will stock the new razors. The sales force is effectively selling the benefits of the new products. These benefits were developed as a result of market and product research. Marketing and sales therefore go hand in hand. Marketing is all about finding out what the customer wants. Selling is all about showing the customer that you can please them by providing them with the products that they want. Marketing is designed to achieve profitable sales. It involves the use of powerful tools to manipulate the decisions of individuals and of other firms in the private and public sectors. This means that boundaries must be set to define the limits of acceptable behaviour. Some limitations are imposed on a voluntary basis by firms themselves and by industry-based organisations such as the Advertising Standards Authority. But the law must provide the ultimate source of regulation in areas such as: consumer protection: laws regulating product safety, honesty in product description and rights to refunds and exchanges; credit: laws requiring lenders to provide full information about a loan including the Annual Percentage Rate (APR); also giving time for borrowers to change their minds; information: obligation to disclose information held about consumers; child protection: age limits for the sale of alcohol and tobacco products; film certification. Overall the law has to find a balance between the importance of profitable business enterprise and the need to protect consumers from unfair or anti-social marketing activity. Essential Vocabulary to persuade customers

сатып алушыларды көндіру

убеждать покупателей

to convince customers

тұтынушыларды бірнəрсеге сенуге мəжбүрлеу

заставить потребителей поверить

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to carry out researches

зерттеу жұмыстарын жүргізу

проводить исследования

retail outlets

бөлшек сауда орындары

точки по розничной торговле

to reach profitable sales

тиімді саудаға қол жеткізу

достичь выгодной торговли

private and public sectors

жеке жəне қоғамдық секторлар

частные и общественные сектора

to impose limitations

шектеулер енгізу

накладывать, вводить ограничения

to involve advertising and жарнамалау мен насиpromotion хаттауды іске қосу

включать в процесс рекламирование и продвижение

the needs and requirements of consumers

тұтынушылардың мұқтаждары мен талаптары

нужды и потребности потребителей

to use powerful tools of manipulating

айла-шарғының мықты түрін қолдану

использовать мощный инструмент манипулирования

to avoid from unfair or anti-social marketing activity

əділетсіз немесе əлеуметке қарсы маркетинг қызметінің алдын алу

избегать от несправедливой или антисоциальной маркетинговой деятельности

Tasks: 1. Read the text “Marketing and sales”. Write out and memorize unknown words and word combinations 2. Translate the text into Kazakh/Russian. Answer the following questions: 1. What is marketing? 2. What is sales force? 3. What should be done to increase sales? 4. What limitations are provided by the ultimate source of regulation? 5. What does the law have to do in order to protect consumers from unfair or anti-social marketing activity?

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Retailers are an important link in the marketing channel because they are both marketers and consumers for producers RETAILING and wholesalers. They perform many marketing activities, such as buying, selling, grading, risk taking, and developing information about consumers’ wants. Of all marketers, retailers are the most visible to ultimate consumers. They are in a strategic position to gain feedback from consumers and to relay ideas to producers and intermediaries in the marketing channel. Retailing is the extraordinary dynamic area of marketing. Retailing includes all transactions in which the buyer intends to consume the product through personal, family, or house hold use. The buyers in retail transactions are ultimate consumers. A retailer, then, is an organization that purchases products for the purpose of reselling them to ultimate consumers. Although most retailers ‘sales are to consumers, nonretail transactions occasionally occur when retailers sell products to other businesses. Retailing activities usually take place in a store or in a service establishment, but exchanges through telephone selling, vending machines, and mail-order retailing occur outside stores. By providing assortments of products that match consumers’ wants, retailers create place, time, and possession utilities. Place utility is moving products from wholesalers or producers to a location where consumes want to buy them. Time utility involves the maintaining of specific business hours so that product are available when consumers want them. Possession utility means facilitating the transfer of ownership or use of a product to consumers. Retailers of services usually have more direct contact with consumers and more opportunity to alter the product in the marketing mix. Retail stores seek to provide product mixes to match consumers’ shopping preference. Department stores are large retail organizations employing at least 25 people and characterized by wide product mixes. To facilitate marketing efforts and internal management in these stores, related product lines are organized into separate departments. General merchandise department stores carry a larger number of product lines. To attract additional consumers, many general merchandise department stores have recently added automotive, recreational, and sports equipment departments as well as services Text 9

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such as insurance, hair care, travel advice, and income tax preparation. Corporate chain department stores generate tremendous sales volume, which gives them considerable control over a wide range of the products they sell. Chain stores have high name recognition and advertise through many forms of media. Mass retailers (merchandisers) are retailers that generally offer fewer consumer services than department stores and emphasize lower prices, high turnover, and large sales volumes. They usually have a wider product mix than department stores. Mass merchandising operations are characterized by one-story, low-cost facilities; self-serve shopping; central checkout counters; and multiple purchases. Discount stores are self-service, general merchandise outlets that regularly offer brand-name merchandise at low prices. Discounts accept lower margins than conventional retailers in exchange for high sales volume. Essential Vocabulary retailers and wholesalers

көтерме жəне бөлшек саудагерлер

розничные и оптовые торговцы

to be visible to ultimate consumers

нақты тұтынушыларға танымал болу

быть заметным конечным потребителям

to gain feedback from consumers

тұтынушылардан кері байланыс алу

получить отклик от потребителей

nonretail transactions

көтерме сауда операциялары

нерозничные операции

a service establishment

қызмет көрсету мекемесі заведение, учреждение по оказанию услуг

direct selling

делдалсыз сату

продажа без посредников

salesforce

сауда агенттері, сауда кəсіпорындарының жұмысшылары

торговые агенты, работники торговых предприятий

marketing mix

маркетингтік байланыс

маркетинговая смесь

retail outlet

бөлшек сауда орны

розничная торговая точка

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marketing

маркетинг

маркетинг

to alter the product

тауарды өзгерту(түсі, пішіні)

изменить продукт (цвет, форму)

Tasks: 1. Read the text “Retailing”. Write out and memorize unknown words and word combinations. 2. Translate the text into Kazakh/Russian. Answer the following questions: 1. What role do retailers play in marketing channel? 2. Why are retailers considered to be the most visible to ultimate consumers? 3. What is usually done to facilitate marketing efforts and internal management in retail stores? 4. What has recently been undertaken by general merchandise department stores to attract additional consumers? 5. What is the main concept of discount stores?

Supermarkets are large, selfservice stores that carry a complete line of food products, as well as some SUPERMARKETS AND OTHER RETAIL FACILITIES nonfood products, such as cosmetics and nonprescription drugs. To remain competitive, some supermarkets are cutting back services, emphasizing low prices, and using promotion methods such as games or coupons. Other supermarkets have converted to discount or warehouse retailing or both. Still other supermarkets have taken the opposite approach, dramatically expanding both services and product mixes. They are also trying to increase their efficiency and competitiveness with technological changes. Superstores – which originated in Europe but are fairly new to U.S. markets – are giant retail outlets that carry not only all food and nonfood products ordinarily found in supermarkets, but also many consumer products that are purchased routinely. Consumer are more attracted to superstores by the lower prices and the one step shopping feature. Superstores combine supermarkets and discount stores into one location. They commonly allocate 40 to 50 % of their selling Text 10

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space to grocery products and the reminder to general merchandise, including athletic shoes, designer jeans, and other apparel; refrigerators, televisions, and other appliances; house wares; cameras, toys, jewelry; hardware; and automotive supplies. The warehouse/wholesale club is the newest form of mass merchandising – a large-scale, members-only selling operation that combines cash-and-carry wholesaling features without discount retailing. Small business owners account for about 60 percent of a typical club’s sales. They offer the same types of products as discount stores but in a limited range of sizes and styles. The warehouse showroom as a retail facility with 5 basic characteristics: (1) large, low-cost building; (2) use of warehouse materials handling technology; (3) use of vertical merchandise display space; (4) a large on-premises inventory and (5) minimum services. In the catalog showroom, one item of each product is on display, often in a locked case, and remaining inventory is stored out of the buyer’s reach. Using catalogs that have been mailed to their homes or are on counters in the store, customers’ order products are presented in manufacturer’s carton. Catalog showrooms regularly sell below list price and often provide goods immediately. Traditional specialty retailers are stores carrying a narrow product mix with deep product lines. They are sometimes called limited-line retailers; if they carry unusual depth in one main product category, they may be referred to as single-line retailers. Specialty stores usually offer better selections and more sales expertise than department stores, their main competitors. Off in price retailers are stores that buy manufacturers’ seconds, overruns, and off-season production runs at below-wholesale prices for resale to consumers at deep discount. Off-price retailers offer limited lines of national-brand and designer merchandise, usually clothing, shoes, or house wares. Non-store retailing is the selling of goods or services at side the confines of a retail facility. Direct marketing is the use of non personal media to introduce products to customers, who then purchase the products by mail or telephone. Forms of non-store retailing include in-home retailing.

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Essential Vocabulary self-service stores

өз-өзіне қызмет көрсету дүкендері

магазины самообслуживания

to increase efficiency and competitiveness

тиімділік пен бəсекеге қабілеттілікті арттыру

повышать эффективность и конкурентоспособность

giant retail outlets

бөлшек саудамен айналысатын ірі сауда нүктелері

крупные торговые точки по розничной торговле

a limited range of sizes and styles

көлем мен үлгінің шектеулі саны

ограниченное число размеров и фасонов

to purchase routinely

күн сайын сатып алу

покупать повседневно

to offer more sales expertise

үлкен сауда қабілеттілігін көрсету

проявлять большую торговую компетентность

to buy overruns and offseason products

артық жəне маусымдық емес өнімді сатып алу

покупать излишки и несезонную продукцию

to be on display

(тауарды, тауар үлгісін) ұсыну

выставлять (товар, образец товара)

to sell below list price

ұсынылған бағадан төмен бағамен сату

продавать по цене ниже выставленных

to provide goods immediately

тауарды тез / лезде жеткізу

доставлять товар сразу

at side the confines of a facility

сауда мекемесінен тыс жерде

за пределами торгового учреждения

Tasks: 1. Read the text “Supermarkets and other retail facilities”. Write out and memorize unknown words and word com-binations. 2. Translate the text into Kazakh/Russian. Answer the following questions: 1. How are supermarkets trying to increase their efficiency and competitiveness? 2. What is the difference between the supermarkets and superstores? 3. What form of mass merchandising operates without discount retailing? 4. Speak on 5 basic characteristics of the ware house showroom? 5. Can you give some information about off in price retailers?

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Marketing agencies find out whether is a demand for a product and what sort of demand it is. They will want to know if ADVERTISING AND there are competitors to the product they MARKETING are going to place; who will use it – men, women, or both?; will there be only one section of men or women who will use it?; would a low price attract more customers, or would they need to add something to it to make it popular, or change its packaging – redesign it? For the answers to these and other questions they will make a survey – an examination – of the market. The survey most people are familiar with is the questionnaire, where a sample – specially selected group of people – are asked questions about products they use and why they buy them. But market research techniques can be more complicated than this, involving, for example, a group discussing a subject, say, personal hygiene, to find out if a new toothpaste will sell. Tests may be made by giving away free samples of the product. Or relations to a brand name – the name of a product – may be studied to find out whether a new product will be successful on the market. From their information, the marketing company can prepare their advertising campaign – the promotion plan. There are two types of advertising – product and brand advertising. Product advertising tells people that a new invention or device is being sold. Perhaps a new design of typewriter with special functions, or a new pen that is easier to use. Typewriters and pens are not new, but what they do, how they do it, or what they are made of may be different, and that makes them a new product. Brand advertising tells people there is a new name on the market. The product, what it does, and how it is made could be the same as others, for example soap powder, but its name is different. In the UK there are basically only two detergent companies – soap companies, producing hundreds of brand names for powders that are really the same product. Whether it is a new product or brand, the producer must consider why people will buy it so that he knows how to advertise it and who to advertise it to. Buyers may want it because it makes their lives easier, e.g. the washing machine, non-iron shirts, or fast food shops. They may want it for health reasons – patent medicines, natural food, or for economy which explained the sudden increase in motor-cycle sales Text 11

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after oil prices rose. Prestige – status – might sell the product: names like Rolls-Royce, Cardin, and Chanel are associated with quality and status. All this information will give the producer an idea of what certain groups of people want, why they want it, how much they will pay for it, and the competition he will meet in the export market. He can now plan the type of advertising needed, where the advertisements should be placed, and where the products should be sold, e.g. stores, supermarkets, or shops. If the product becomes established in the new market, the process of marketing and advertising should still continue to maintain the position. A well-established international German company found a few years ago that although their quality and development in their products had remained the same, sales were falling. The market research company they called in to investigate the problem told them that their image – the way the public saw them – was responsible. Their products were considered more expensive than others, although this was not true. Their designs were considered old-fashioned, also not true. And middle-aged people were thought to use their products more than young people. A new strong advertising campaign, which is still in progress, has completely changed their image. Essential Vocabulary to attract customers

тұтынушыларды тарту

привлекать потребителей

to make a survey

тұтынушылар арасында сауалнама жүргізу

проводить обследование клиентов

samples of a product

тауар, өнім үлгісі

образцы продукта, товара

to run tea advertising campaign

шайды жарнамалау жұмыстарын жүргізу

проводить компанию по регламированию чая

to be associated with quality and status

сапа жəне мəртебе секілді түсініктермен байланысты болу

быть связанным с понятиями “качество и статус”

to explain the sudden increase

күтпеген / тосын өсім жайын түсіндіру

объяснить неожиданный рост

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to be considered oldfashioned but expensive

сəн үлгісінен қалып қойған, бірақ қымбат болып саналу

считаться старомодной, но дорогой

to be in progress

үдерісте болу

быть в процессе

goals of advertising

жарнама мақсаттары

цели рекламы

informative advertising

ақпаратты сипаттағы жарнама

информирующая реклама

to increase sales

сату көлемін арттыру

повысить объем продаж

Tasks: 1. Read the text “Advertising and Marketing”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What is the role and the general goal of advertising? 2. What types of advertising do you know? 3. What companies are usually prohibited from TV advertising? 4. What kind if goods are usually introduced by outdoor advertising? 5. Dwell upon the statement: “The very first law in advertising is to avoid the concrete promise and cultivate the delightfully vague.”

What is management? Management is like investment: its goal is to get the most out of resources, add the most value MANAGEMENT or get the best return. Management can be defined as: achieving goals in a way that makes the best use of all resources. This definition covers self-management as well as managing people, being a manager. Whenever you prioritize, you are managing your time. You manage yourself and all other resources at your disposal in order to do a good job. Leadership, by contrast, is about influencing people to change direction. When senior executives decide to change direction, this is seen as leadership. But because it is a decision, it is a management act - not leadership. Decisions flow from authority, leadership is an act of Text 12

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influence. Leadership is an attempt to influence followers. It’s never a decision of any sort. All decisions made by executives are managerial actions. This is not the conventional view of leadership and management but, if leadership is an influence process, one implication is that there can be no such thing as autocratic leadership. Decisions can be made autocratically, but deciding for people is not a type of influence so it shouldn’t be classed as leadership. The Meaning of Management. We need to understand the meaning of management in order to know what management skills to develop. Think of what is means to be an investor – someone with money to invest and wanting the best return. Such a person shifts his or her money around regularly to improve return. Similarly, managers have resources at their disposal to invest – people, material and a budget, in addition to their own time and energy. Smart managers think carefully on a regular basis about how to get the best return on these resources. When managing people, it is not just a matter of having the right employee in the right place at the right time; it is also about developing and improving that resource. Effective managers are catalysts, brokers, facilitators, coaches and people developers. Because thinking is the most important work we do today, managers need to ask stimulating questions to draw new solutions out of people, to get mental work done through them. This makes managers-facilitators more than decision makers as they were thought of in the old days. Certainly they still make decisions, but ineffective managers do too much of their own thinking, hence not reaping the fullest possible return of all resources at their disposal. They are poor investors as a result. Effective managers know that delegation is not enough in today’s knowledge driven world to get work done through people. This is because most of the critical work we do today is to make decisions, solve problems and think creatively. This is mental work. Smart managers get this kind of work done through people by asking them the sorts of questions that stimulate people to think, to draw solutions out of people. Ineffective managers may delegate a lot but this is so they can be free to do most of their own thinking and problem solving. They fail 56

to work with and through people when it comes to this mental work. Skilled managers know how to get the best out of people by asking them the right questions – those that make them think differently, not simply fact-gathering questions. Management needs to be upgraded for the 21st century. It needs to cast off its negative image as mechanistic, controlling and task oriented. We need a concept of management that makes it nurturing, supportive, coaching and developmental. This is essential to divide the load between leadership and management more equally. Essential Vocabulary to achieve goals

мақсатқа жету

достичь цели

to influence people

адамдарға əсер ету

влиять, воздействовать на людей

at one’s disposal

біреудің өкімінде болу

быть в чьем-то распоряжении

to divide the load equally

жүктемені тең бөлу

делить нагрузку поровну

managerial actions by executives

лауазымды тұлғалардың административные əкімшілік əрекеттері действия должностных лиц

to improve return

табысты /пайданы өсіру

повысить прибыль

to draw new solutions

жаңа шешімдер қарас-тыру

разрабатывать новые решения

conventional view

дəстүрлі көзқарас

традиционная точка зрения

mental work

ой еңбегі

умственная работа

to make decisions autocratically

өз еркімен шешім қабылдау

выносить решения самовольно

effective managers

тиімді/пайдалы менеджерлер

эффективные менеджеры

Tasks: 1. Read the text “Management”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian

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Answer the following questions: 1. What is management? 2. What should a manager o in order to do a good job? 3. What is leadership? 4. Why is leadership considered to be an influence process? 5. How do effective and smart managers make decisions solve problems and get the best out of people? 6. What concepts of management are necessary to be upgraded for the XXI century?

This question, as asked, is a problem because it focuses on people in roles. This is normally how we think about them but WHAT’S THE DIFFERENCE BETWEEN there is a better way. We need to recognize that all employees can both lead and MANAGERS AND manage. For example, whenever you set LEADERS? priorities, you are managing your time. Whenever you set an example by working harder or smarter and others follow your example, you have shown leadership. Similarly, when you convince your boss to think differently, you show leadership bottom-up. Thus management and leadership are functions, which are like tools because anyone can use them. Writing, analyzing, knitting, cooking are also process tools that everyone can use. Managers use the same management tools and processes used by front-line employees; they just have more resources to manage. Leadership works through influence, while management works through decisions and facilitation. Leadership must be restricted to selling the tickets to the journey. It can’t take followers to the destination. Why? Because this is the only way to account for a number of otherwise odd kinds of leadership such as leading by example, green leadership and bottom-up leadership. Take green leadership for instance. If a green leader promotes green policies in Norway and is followed by an organization in India, then leadership is not a two-way relationship between leader and follower and leadership stops once the target audience buys the proposal. This is important if we want to explain how leadership can be shown bottom-up. Text 13

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All the old clichés about management are wrong, on this view. Our negative attitude toward management arose following the success of Japanese business in the West. This led to a great hue and cry to replace managers with leaders. Management has had a bad name ever since, totally undeserved. Everyone has wanted to be a leader, not a manager, ever since the early 1980’s. Japanese business success at that time drove Western managers and gurus to proclaim an end to management. They wanted to banish managers and replace them with leaders. This was an emotional overreaction. Instead, we should have upgraded management. The views expressed on this website, Leaders direct, are not in line with conventional thinking which has little that is very positive to say about the role of manager. It is because of this historical baggage that you hear people say that managers are only interested in the present, preserving the status quo, keeping things ticking over and that they are controlling or bureaucratic. This is really nonsense. If we define management simply as the aim to get the best return out of all resources, then any style that works is compatible with this definition. Enlightened managers can be people-oriented and good at fostering innovation. They can SHOW leadership by promoting better ways of working and by setting an inspiring example. We can’t live without good management. Nothing would get done without it. On a personal level, how could you make best use of your time and your life if you didn’t set priorities and invest your time wisely? Similarly, the world is so complex that nothing is possible without the coordination of large numbers of people. This takes good management. Management today, is about facilitation, enabling others to act, being a catalyst and coach. Essential Vocabulary to set an example

үлгі болу

подать пример, стать примером

to think differently

басқаша ойлау

думать (мыслить ) по-другому

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to raise hue and cry

шу көтеру

поднять шум

to have an undeserved bad жаман атқа қалу / name беделі түсу

(несправедливая) незаслуженная плохая репутация

to proclaim an end to …

бірнəрсенің біткені туралы жариялау

провозгласить конец чему-то..

to banish managers

менеджерлерді қуып жіберу

изгнать менеджеров

to be interested in

қызығу / қызығушылық таныту

интересоваться, проявлять интерес

to be compatible with

үйлесімді болу

быть совместимым с ...

enlightened managers

оқыған / көзі ашық менеджерлер

просвещенные менеджеры

to be good at fostering innovation

жаңашылдық таныту / жаңашыл болу

преуспевать в продвижении нововедений, новшеств

to set priorities

басымдылықтарды анықтау

установить приоритеты

Tasks: 1. Read the text “What’s the difference between managers and leaders?”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. Is it possible that all employees can both lead and manage? 2. How can a leader set an example in order to make others follow him? 3. Dwell upon the statement: leadership works through influence, management works through decisions and facilitation. 4. Will you explain how leadership can be shown bottom-up? 5. What made people change their minds on management’s bad name?

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The Qualities of a Successful Manager. What makes a good manager? MANAGEMENT STYLES First of all, the ability to communicate, to get your ideas across and to listen to AND CULTURE other people. Secondly, a good sense of organization so that working practices are efficient and problems can be anticipated and avoided. Thirdly, managers work long hours and therefore a great deal of stamina is required to avoid stress. A good manager must also be initiative in his/her own ability to deal with difficult situations and show qualities of leadership, so that others will want to follow. Managers have to take the judgment and bring fresh, creative ideas to old problems. But sound confident is necessary when a choice of possible courses of action is difficult or risky. Once decisions are taken, a manager has to make sure they are implemented and obeyed. For this, he or she must demonstrate integrity; this includes a sense of honesty, trust and loyalty to the organization and the personnel under his or her control. Managers should also be accountable to their own boss and be able to explain the reasons for making any decision. Manager makes decision and announces it – The team has no role in the decision-making role. Coercion may or may not be used or implied. Manager “Sells” decision – Rather than just tell, the manager needs to sell the decision, as there is a possibility of some resistance from team members. Manager presents ideas and invites questions – This allows the team to get a fuller explanation so they can better understand of what she is trying to accomplish. Manager presents a tentative decision that is subject to changes. This action invites the team to have some influence regarding the decision; thus, it can be changed based on the team’s input. Manager presents the problem, gets suggestions, and then makes the decision – Up to this point the manager has always presented the decision, although the last one did allow it to change based upon the team’s input. Now the team is free to come up with options, however, the manager still decides on those options. Text 14

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Manager defines limits, and requests the team to make a decision – The manager delegates the decision making to the team; but still instills specific limits on the team’s solution. Manager allows a team to function within limits – Now the team does the decision making, however, the manager’s superior may have placed certain limits on the options they can make. If the manager sits in on the decision making, he or she attempts to do so with no more authority than the other members do. Basically the first two styles or behaviors are similar the authoritarian style, the next three are similar to the participative style, while the last two are similar to the delegative style. This approach gives the leader more options that can be refined to specific situations or environments. Essential Vocabulary to be able to anticipate and қиын мəселелерді avoid problems болжау жəне олардың алдын ала білу

уметь предвидеть и избегать проблем

to have a great deal of stamina

өте шыдамды / көнбіс болу

обладать огромной выдержкой, выносливостью

to deal with difficult situations

қиын жағдайлардан жол таба білу

рассматривать, справляться с трудными ситуациями

sound confident

аса сенімді тұлға

серьезное доверенное лицо (твердая уверенность)

to demonstrate integrity

адал болу

проявлять честность, принципиальность, неподкупность

to be accountable to …

біреудің алдында жауапты болу

быть подотчетным кому-то

to explain the reasons

негіздеу / дəлелдеу

обосновать

to use coercion

күш қолдану, мəжбүрлеу применять принуждение

to be subject to changes

өзгерілуі тиіс болу

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подлежать изменениям

a tentative decision

алдын-ала қабылданған шешім

to be free to come up with өз нұсқасын ұсынуға options (құқы бар болу) ерікті болу

предварительное решение быть свободным (иметь право) предлагать свои варианты

Tasks: 1. Read the text “Management styles and culture”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What makes a good manager? 2. What must a manager demonstrate in order to make sure that decisions are implemented? 3. How does a manager act when there is a possibility of some resistance from team members? 4. What is the main purpose of presenting a tentative decision by a manager? 5. Why is it necessary for a manager to instill specific limits on the team’s solution?

Leadership style is the manner and approach of providing direction, LEADERSHIP STYLES implementing plans, and motivating people. As seen by the employees, it includes the total pattern of explicit and implicit action of their leaders (Newstrom, Davis, 1993). In 1939 Kurt Lewin led a group of researchers to identify different styles of leadership (Lewin, LIippit, White, 1939). This early study has been very influential and established three major leadership styles: (U.S. Army, 1973): 1. Authoritarian or autocratic; 2. Participative or democratic; 3. Delegative or laissez-fair. Although good leaders use all three styles, with one of them normally dominant, bad leaders tend to stick with the one style of autocratic. Authoritarian or Autocratic. This style is used when leaders tell their employees what they want done and how they want it Text 15

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accomplished, without getting the advice of their followers. Some of the appropriate conditions to use it is when you have all the information to solve the problem, you are short on time, and your employees are well motivated. Some people tend to think of this style as a vehicle for yelling, using demeaning language, and leading by threats. This is not the authoritarian style, rather it is an abusive, unprofessional style called “bossing people around.” It has absolutely no place in a leader’s repertoire. The authoritarian style should normally only be used on rare occasions. If you have the time and want to gain more commitment and motivation from your employees, then you should use the participative style. Participative or Democratic. This style involves the leader including one or more employees in the decision making process (determining what to do and how to do it). However, the leader maintains the final decision making authority. Using this style is not a sign of weakness, rather it is a sign of strength that your employees will respect. This is normally used when you have part of the information, and your employees have other parts. A leader is not expected to know everything – this is why you employ knowledgeable and skilled people. Using this style is of mutual benefit as it allows them to become part of the team and allows you to make better decisions. Delegative or Laissez-faire. In this style, the leader allows the employees to make the decisions. However, the leader is still responsible for the decisions that are made. This is used when employees are able to analyze the situation and determine what needs to be done and how to do it. You cannot do everything! You must set priorities and delegate certain tasks. This is not a style to use so that you can blame others when things go wrong, rather this is a style to be used when you fully trust and have confidence in the people below you. Do not be afraid to use it, however, use it wisely! Essential Vocabulary to provide directions

бағыт-бағдар көрсету

указать направления

to include explicit and implicit actions

нақты/анық жəне ұйғарымды əрекетті қосу

включать очевидные и подразумеваемые действия

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to be short of time

уақыт тығыз болу

испытывать недостаток времени

a laisser-faire[lesei’feə] style

араласпау/ қол сұқпаушылық саясаты

политика невмешательства

to use demeaning language

абыройға нұқсан келтіретін сөз айту

употреблять язык унижающий достоинство человека

to lead by threats

қорқыта, үркіте отырып басқару

руководить угрожая

to boss people

адамдарды бағындыру / билеу

помыкать людьми (командовать)

a sign of weakness (strength)

əлсіздік (күштілік, сенімділік) белгісі

признак слабости (силы, уверенности)

to be of mutual benefit

өзара пайда тигізу

представлять взаимную пользу

to be responsible for smth бірнəрсеге жауапты болу

нести ответственность за что-либо

to trust fully and have confidence in smb

полностью доверять и верить кому-либо

біреуге толығымен сенім арту жəне сену

Tasks: 1. Read the text “Leadership Styles”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What is important to know in order to identify different styles of leadership? 2. What leadership styles do normally good leaders use? 3. Is the authoritarian style often used? 4. In what cases is the participative or democratic style used, which is considered to be of mutual benefit? 5. Can you enumerate the positive sides of the laisser-faire leadership style?

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Unit IV MACROECONOMICS

Macroeconomics (from the Greek prefix makro- meaning “large” and MACROECONOMICS economics) is a branch of economics that study the performance, structure, AS A BRANCH decision-making, behavior of the whole OF ECONOMICS economies or economic systems instead of the behavior of individuals, individual firms, or markets (which is the domain of Microeconomics). It is concerned primarily with the forecasting of national income, through the analysis of major economic factors that show predictable patterns and trends, and of their influence on one another. These factors include level of employment/ unemployment, gross national product (GNP), balance of payments position, and prices (deflation or inflation). Macroeconomics also covers role of fiscal and monetary policies, economic growth, and determination of consumption and investment levels. This includes national, regional, and global economies. Macroeconomists study aggregated indicators such as GDP, unemployment rates, and price indexes to understand how the whole economy functions. Macroeconomists develop models that explain the relationship between such factors as national income, output, consumption, unemployment, inflation, savings, investment, international trade and international finance. While macroeconomics is a broad field of study, there are two areas of research that are emblematic of the discipline: the attempt to understand the causes and consequences of short-run fluctuations in national income (the business cycle), and the attempt to understand the determinants of longrun economic growth (increases in national income). Macroeconomic models and their forecasts are used by governments to assist in the development and evaluation of economic policy. Basic macroeconomic concepts. Macroeconomics encompasses a variety of concepts and variables, but there are three central topics for macroeconomic research. Macroeconomic theories usually relate Text 1

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the phenomena of output, unemployment, and inflation. Outside of macroeconomic theory, these topics are also important to all economic agents including workers, consumers, and producers. Output and income. National output is the lowest amount of everything a country produces in a given time period. Everything that is produced and sold generates income. Therefore, output and income are usually considered equivalent and the two terms are often used interchangeably. Output can be measured as total income, or, it can be viewed from the production side and measured as the total value of final goods and services or the sum of all value added in the economy. Macroeconomic output is usually measured by Gross Domestic Product (GDP) or one of the other national accounts. Economists interested in long-run increases in output study economic growth. Advances in technology, accumulation of machinery and other capital, and better education and human capital all lead to increased economic output over time. However, output does not always increase consistently. Business cycles can cause short-term drops in output called recessions. Economists look for macroeconomic policies that prevent economies from slipping into recessions and that lead to faster long-term growth. Essential Vocabulary predictable patterns and trends

болжамды құрылымдар мен бағыттар

предсказуемые модели и направления

GNP (gross national product)

жалпы ұлттық өнім

валовой национальный продукт

GDP (gross domestic product)

жалпы ішкі өнім

валовой внутренний продукт

consumption level

тұтыну деңгейі

уровень потребления

aggregated indicators

жинақы көрсеткіш

совокупные показатели

short-run fluctuations

қысқа мерзімді ауытқулар

недлительные колебания

to understand the causes and consequences

себебі мен салдарын түсіну

понять причины и последствия

evaluation of economic policy

экономикалық саясатты бағалау

оценка экономической политики

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to encompass a variety of concepts

алуан түрлі тұжырымдарды қамту

включать разные концепции

to generate income

табысты / кірісті жинақтау

генерировать доход

to slip into recessions

экономикалық дағдарыс- привести к экономичесқа əкелу кому спаду

Tasks: 1. Read the text “Macroeconomics as a branch of economics”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What is macroeconomics? 2. What are the main fields that macroeconomics is concerned about? 3. What models do macroeconomists develop? 4. How do macroeconomists try to understand the causes and consequences of short-run fluctuations? 5. Dwell upon the basic macroeconomic concepts.

Money lies at the core of all economic activity and serves many important economic functions. MONEY The origins of money go back thousands of years. To begin with, items of value such as beads, shells, stones, cattle and grain were all used as money. Later, it was realised that it was necessary to have a generally acceptable medium of value through which all goods could be traded. In inflationary times, confidence in money declines. Inflation is the term used to describe the rate at which the value of money falls. Changes in the rate of inflation affect the general level of interest rates in a country, as an increasing number of countries use interest rates, rather than levels of taxation or credit restrictions, as the chief financial tool in controlling inflation. In a society with few controls over spending, the public’s attitude to how it uses it money changes sharply and sometimes swiftly. If inflation is high, many decide to spend now rather than save, on the Text 2

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basis that purchases in the future will cost more, and that the value of their savings is falling if the rate of inflation exceeds the level of interest savings are earning. The opposite situation (deflation) can occur when the value of money rises. This may appear preferable, but it is equally disastrous and may cause widespread economic damage. Deflation usually occurs when an economy is in recession or in depression, actually shrinking. Those with ready access to money-inevitably a minoritywill benefit. The majority will suffer serious consequences, chiefly through unemployment. And those who have been putting money aside are likely to see their savings melt away. It is in attempts to avoid extreme inflation or deflation that governments and their central banks develop fiscal and monetary policies. The key to success is that supply of money be flexible enough to change as the economy changes. Without this flexibility, slumps and booms are more frequent and sharper. Essential Vocabulary to serve economic functions

экономикалық қызметтерді выполнять экономичесорындау кие функции

medium of value

айналым құралы

средство обращения

the rate of inflation

инфляция деңгейі

уровень инфляции

the level of interest rates пайыздық мөлшерлеме деңгейі

уровень процентных ставок

to change sharply and swiftly

күрт жəне тез өзгеру

меняться резко и быстро

to be equally disastrous

бірдей зиян əкелетін

быть в равной степени разрушительной

to suffer serious consequences

ауыр салдарға тап болу

столкнуться с серьезными последствиями

to develop fiscal and monetary policies

қаржы-валюта саясатын жүргізу

проводить финансововалютную политику

to be flexible enough

барынша икемді / ыңғайлы болу

быть достаточно гибким

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to avoid extreme inflation

тым жоғары инфляцияның избежать предельно алдын алу высокой инфляции

slumps and booms

бағаның күрт түсуі жəне дағдарыстар

резкое падение цен и кризисы

Tasks: 1. Read the text “Money”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. Why do we say that money lies at the core of all economic activity? 2. Can you give some information about the origins of money in different countries (China, Egypt, etc.) 3. Why does confidence in money decline in inflationary times? 4. When does deflation usually occur? Try to give your own examples. 5. What do governments and their central banks undertake in order to avoid extreme inflation?

The most important use of money is as a medium of exchange. A medium MONEY AS A MEDIUM of exchange is any item that sellers will accept in payment for goods or services. OF EXCHANGE The amount of money which can be spent depends upon the supply of it and the number of times it is used (spent) in a particular period. For example, if the money in issue is $ 1 mln and the average dollar is spent 20 times a year the flow of money – the supply – will be $ 20 mln. In other words, the goods and services paid for with the same $ 1 mln during the year are worth $ 20 million. Then assume that the supply of money is doubled but the amount of goods and services remains unchanged. In the real world, of course, the supply of goods and services changes constantly, and their flow , must be balanced with the flow of money if an economy is to progress. In around 2500 B.C. the Egyptians started to use metal money, in the form of rings- they were light and easy to carry. The Chinese followed about 400 years later, with gold cubes. The first coins, beanText 3

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shaped and made of a gold and silver alloy, were minted in Lydia in western Turkey around 700 B.C. But it was the Greeks and Romans who perfected coinage. Since then all the processes have been refinements rather than innovations. In 1273 Marco Polo reported that the Chinese Emperor Kubbai Khan had mulberry-bark paper notes which carried his seal and the signatures of his Treasury officials. The oldest surviving piece of paper money is a Chinese note called the Khan which was issued during the Ming Dynasty between 1368 and 1399. In order to avoid some inconveniences and fears of robbery, the first solution appeared-to exchange coins for receipts – issued by goldsmiths rather than banks-which had no value to thieves. People began to swap the receipts themselves rather than exchange them for coins. It meant that paper money in the modern sense was born. As coins and paper money became more widely available, each country developed it is own currency, which came to be measured in value against that of other countries, leading eventually to the setting –up of official foreign exchanges. Though national currencies have so far remained sacrosanct, there is strong pressure within some regions for a single currency, for example, in the European Union. In modern times, coins and paper money were often backed by gold- the also- called gold standard. This meant that the value of the basic unit of the currency of a country was fixed in terms of gold. Essential Vocabulary to depend upon supply

ұсынысқа тəуелді болу

зависеть от предложения

to remain unchanged

өзгеріссіз қалу

оставаться неизменным

to mint coins

тиындар басып шығару

чеканить монеты

to perfect coinage

тиын жүйесін жетілдіру

совершенствовать монетную систему

the process of refinements жетілдіру үдерісі

процесс совершенст-вования

paper money

қағаз ақша

бумажные деньги

to avoid in conveniences

қолайсыздықтардың алдын алу

избегать неудобств

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to have no value to thieves ұрылар үшін құнды болмау

не представлять ценность для воров

to swap the receipts

векселдерменен айырбас обмениваться векселями жасау

to become widely available

барлығына қолжетімді болу

стать широко доступным

to remain sacrosanct

дербес құқыққа ие боп қалу

оставаться неприкосновенным

a single currency

бірыңғай валюта

единая валюта

Tasks: 1. Read the text “Money as a medium of exchange”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh / Russian Answer the following questions: 1. Give some information on the emergence of the first coins and paper money as a generally acceptable medium of value. 2. Why did it become necessary for each country to develop its own currency? 3. Have national currencies so far remained sacrosanct? 4. Isn’t it better to have a single currency for all the countries? 5. Can you give some information about the European Union’s single currency “euro”? 6. Why is the value of the basic unit of the currency of a country fixed in terms of gold?

Throughout all these changes, money has been accepted as the most convenient medium of exchange for the provision THE FUNCTIONS OF of labor, goods or services. To work MONEY efficiently and to have the confidence of the public, money must be accepted as a: Medium of exchange Measure of value Store of value Standard for deferred payments. Government, though with difficulty, can control the money supply but they cannot always control demand nor the price of goods and Text 4

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services. Natural disasters, political changes and international tension are just three areas over which individual government has little or no control. A war, a drought, etc. will affect world prices, regardless of government action. The wild fluctuations in the oil price in 1973 and 1979, which brought such sharp price rises, are a vivid example. To be used as money, an item must have certain characteristics. The five characteristics of money are durability, portability, divisibility, stability in value, and acceptability. Durability refers to money’s ability to be used over and over again. Metals such as gold and silver are ideal because they withstand wear and tear well. In fact, many coins minted in ancient times are still in existence. Portability. Money’s ability to be carried from one place to another and transferred from one person to another is its portability. As a medium of exchange, money must be convenient for people to use. Divisibility refers to money’s ability to be divided into smaller units, which permits buyers and sellers to make transactions of any size. Stability in value. For money to be useful as a store of value, it must be stable in value. Stability in value encourages saving and maintains money’s purchasing power. Most people who save money are confident that it will have approximately the same value when they want to buy something with it as it had when they put it into savings. Acceptability means that people are willing to accept money in exchange for their goods or services. People accept money because they know they can spend it for other products. Essential Vocabulary the most convenient medium

айналымның ең ыңғайлы самое удобное средство құралы обращения

natural disasters

табиғи апаттар

природные бедствия

to affect world prices

əлемдік бағаларға əсер ету

влиять на мировые цены

regardless of …

қарамастан ...

независимо от ....

a vivid example

анық / айқын мысал

яркий пример

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the wild fluctuations of мұнай бағасының тоқoil prices таусыз ауытқуы

безудержное колебание цен на нефть

durability

пайдалану мерзімінің ұзақтығы

продолжительность срока и использования

portability

ықшамдылық, алып жүруге оңай

портативность, легко переносимый

divisibility

бөлінгіштік

делимость

stability in value

құнының тұрақтылығы

стабильность ценности

acceptability

жарамдылық

приемлемость

to maintain purchasing power of money

ақшаның сатып алу қабі- сохранить покупательную летін сақтау способность денег

Tasks: 1. Read the text “The Functions of Money”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What must money be accepted as? 2. What are the main functions of money? 3. Dwell upon the five main characteristics of money. 4. What factors may affect world prices, regardless of government actions? 5. Why do people accept money willingly in exchange for their goods and services?

Monetary policy rests on the relationship between the rates of interest in an economy, that is, the price at which MONETARY POLICY money can be borrowed, and the total supply of money. Monetary policy uses a variety of tools to control one or both of these, to influence outcomes like economic growth, inflation, exchange rates with other currencies and unemployment. Where currency is under a monopoly of issuance, or where there is a regulated system of issuing currency through banks which are tied to a central bank, the monetary authority has the ability to alter the money supply and thus influence the interest rate (to achieve policy goals). Text 5

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The beginning of monetary policy as such comes from the late 19th century, where it was used to maintain the gold standard. A policy is referred to as contractionary if it reduces the size of the money supply or increases it only slowly, or if it raises the interest rate. An expansionary policy increases the size of the money supply more rapidly, or decreases the interest rate. Furthermore, monetary policies are described as follows: accommodative, if the interest rate set by the central monetary authority is intended to create economic growth; neutral, if it is intended neither to create growth nor combat inflation; or tight if intended to reduce inflation. There are several monetary policy tools available to achieve these ends: increasing interest rates by fiat; reducing the monetary base; and increasing reserve requirements. All have the effect of contracting the money supply; and, if reversed, expand the money supply. Since the 1970s, monetary policy has generally been formed separately from fiscal policy. Even prior to the 1970s, the Bretton Woods system still ensured that most nations would form the two policies separately. Within almost all modern nations, special institutions (such as the Federal Reserve System in the United States, the Bank of England, the European Central Bank, the People’s Bank of China, and the Bank of Japan) exist which have the task of executing the monetary policy and often independently of the executive. In general, these institutions are called central banks and often have other responsibilities such as supervising the smooth operation of the financial system. The primary tool of monetary policy is open market operations. This entails managing the quantity of money in circulation through the buying and selling of various financial instruments, such as treasury bills, company bonds, or foreign currencies. All of these purchases or sales result in more or less base currency entering or leaving market circulation. Usually, the short term goal of open market operations is to achieve a specific short term interest rate target. In other instances, monetary policy might instead entail the targeting of a specific exchange rate relative to some foreign currency or else relative to gold. For example, in the case of the USA the Federal Reserve targets the federal funds rate, the rate at which member banks lend to one another overnight; however, the monetary policy of China is to target the exchange rate between the Chinese renminbi and a basket of foreign currencies. 75

Essential Vocabulary monetary policy

қаржы-валюта саясаты

валютно-денежная политика

to alter the money supply

қаржы қорын өзгерту

менять запасы денег

rates of interest

пайыздық мөлшерлемелер

процентные ставки

available tools

қолжетімді құралдар

доступные инструменты (пути)

to execute the monetary policy independently

қаржы–валюта саясатын проводить валютноөз бетінше жүргізу денежную политику самостоятельно

to supervise the smooth operation

операцияның бірқалыпты болуын бақылау

наблюдать за ровным функционированием

treasury bills

қазына векселдері

казначейские вексели

company bonds

компанияның құнды қағаздары/облигациялары

облигации компании

foreign currency

шетел валютасы

иностранная валюта

to achieve a short-term target

қысқа мерзімді мақсатқа жету

достичь краткосрочную цель

Tasks: 1. Read the text “Monetary policy”. Write and memorize unknown words and word-combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What does monetary policy rest on in general? 2. What instruments does monetary policy use in order to influence such outcomes as economic growth, inflation and unemployment? 3. What is the difference between a contractionary and an ex-pansionary policy? 4. What is the main purpose of functioning of monetary and fiscal policy separately? 5. Speak on the cases of the USA and China in targeting a specific exchange rate relative to some foreign currency?

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From the history of banking. Originally the word bank meant bench or shelf. In Italy the word “banco” was THE BANKING applied specially to a tradesman’s counter SYSTEM and hence to a money- changer’s bench or table, from which the modern meaning of an establishment dealing with money is derived. In modern English bane means - судейская скамья (в судье), and in banco is – в полном составе (о суде). ‘ Bankrupt’ as ‘ one unable to pay his debts’ has come from Italian (through French) banco, rotta meaning a bench broken, where by bench the man and his business was meant- not his money- table. Types of banks. This exercise defines the most important kinds of bank. Complete the text using these words: Text 6

Central bank Commercial bank Supranational bank Building bank Merchant bank Universal bank Finance bank Investment bank

1)…….. supervise the banking system; fix the minimum interest rate; issue bank notes; control the money supply; influence exchange rates; and act as lender of last resort. 2)……..are businesses that trade in money. They receive and hold deposits in current and savings accounts, pay money according to customers’ instructions, lend money, and offer investment advice, foreign exchange facilities, and so on. In some countries such as England these banks have branches in all major towns; in other countries there are smaller regional banks. Under American law, for example, banks can operate in only one state. Some countries have banks that were originally confined to a single industry, e.g. the Credit Agricole in France, but these now usually have a far wider customer base. In some European countries, notably Germany, Austria, and Switzerland, there are (3) ………... which combine deposit and loan advice, etc. Yet even universal banks usually form a subsidiary, known as a (4) ………… to lend money – at several per cent over the base lending rate – for hire purchase or installment credit, that is, loans to consumers that are repaid in regular, equal monthly amounts. In Britain, the USA and Japan, however, there is, or used to be, a strict separation between commercial banks and banks that do stock 77

broking or bond dealing. Thus in Britain, (5) ………. Specialize in raising funds for industry on the various financial markets, financing international trade, issuing and underwriting securities, dealing with takeovers and mergers, issuing government bonds, and so on. They also offer stock broking and portfolio management services to rich corporate and individual clients. (6) ………… in the USA are similar, but they can only act as intermediaries offering advisory services, and do not offer loans themselves. Yet despite the Glass – Steagall Act in the USA, and Article 65, imposed by the Americans in Japan in 1945, which enforce this separation, the distinction between commercial and merchant or investment banks has become less clear in recent years. Deregulation in the US and Britain is leading to the creation of “financial supermarkets” – conglomerates combining the services previously offered by stockbrokers, banks, insurance companies, etc. In Britain there are also (7) ………… that provide mortgages, i.e. they lend money to home-buyers on the security of houses and flats, and attract savers by paying higher interest than the banks. The savings and loan associations in the United States served a similar function, until most of them went spectacularly bankrupt at the end of the 1980s. There are also (8) ………… such as the World Bank or the European Bank for Reconstruction and Development, which are generally concerned with economic development. Essential Vocabulary bankrupt

борышкер, қарызын өтей алмайтын адам

несостоятельный должник, банкрот

to derive from

бірнəрседен туындау, /пайда болу

происходить от, производное от

to fix the interest rate

пайыздық мөлшерлемені белгілеу

фиксировать процентную ставку

deposits and saving accounts

депозиттер мен жинақтаушы шоттар

депозиты и сберегательные счета

equal monthly repayment

ай сайынғы бірдей төлемақы

ежемесячная выплата в равной сумме

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to do stock broking

биржалық операциялар жүргізу

проводить биржевые операции

to do bond dealing

облигациялық операциялар вести облигационные жүргізу операции

to issue and underwrite securities

құнды қағаздар шығару жəне жарату

выпускать и размещать ценные бумаги

to offer advisory services

кеңес беру қызметтерін ұсыну

предлагать консультативные услуги

the distinction between commercial and merchant banks

коммерциялық жəне сауда различие между комбанктері арасындағы айыр- мерческим и торговым банками машылық

to provide mortgages

кепілдікке қарыз беру

выдавать заем под закладную

Tasks: 1. Read the text “The Banking system”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. Which bank is to supervise the banking system as a whole? 2. What are the specific features of the American banks? 3. What bank usually provides mortgages to lend money to home-buyers on the security of houses? 4. What banks specialize in raising funds for industry? 5. What banks can only act as intermediaries offering advisory services?

A government can be regarded as the board of directors running a very large corporation. Like them, it has priorities BANKER TO THE and aims. It way want to spend money on GOVERNMENT developing infrastructure; it may want a strong and increasing defence system; it may pursue policies to protect the poor, the youth, the disabled; it may aim to improve the education system and health service. On the other hand, it may not want to do any of these things and prefer to leave as much of the running of their lives in the hands of its citizens as possible. Even if that is true, it Text 7

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will still have to make some basic and unavoidable spending on such items as defence and police to maintain order, both internationally and domestically. To do that, it needs revenues, and this is where governments do not resemble companies. They cannot raise that money from commercial transactions and make profits. They have to take it from people in the form of taxes or persuade them to lend money to the government through either the issue of government securities or nationals savings schemes. After the political decisions have been made, the central bank comes in. It acts as banker to the government, and keeps the banking accounts for the central financial authority and for all other government departments. These will have their budget set by the government. This spending will then proceed through the account which is held at the central bank. In highly developed economies banking operations are subject to a substantial degree of supervision to ensure that they do not operate fraudulently and that their customers’ deposits are secure. The Central Banks (Nationals Banks) are at the heart of any modern banking system. Despite their name, however, they are not in the business of everyday banking. The functions of any central banking authority may vary, but, in general, can be stated very simply. They act as: The government’s banker The bank’s bank The vehicle through which a government carries out its monetary policy The lender of last resort The overall supervisor of the country’s banking system, including control of the issue of notes and coins. The central (national) banks carry out these roles within the context of the country’s laws and regulations, with differing degrees of independence. They may, for example, set basic interest rates, through these may be decided in some countries by the finance ministry or lest to the commercial banks themselves. In some countries, Germany most obviously, the central authority bas autonomy in interpreting government policy. In fact, the independence of the Bundesbank , the German Central Bank, is written into Germany’s post-war constitution. 80

The Bundesbank has been one of the most successful in the world in protecting and promoting the economic interests of Germany. In the USA the freedom of the Federal Reserve System (FRS) in its day-to-day dealings is also written into US law. In contrast, in the UK, the Treasury, under the Chancellor of the Exchequer, has the final say on monetary policy though the personality of the Governor of the Bank of England can greatly increase the Bank’s effective power. The position of the governor, however, is more explicitly political than in Germany or the USA. Not uncommonly, fierce and public arguments can arise between the Bank and a new government when a sitting governor disagrees with new government policies. In an attempt at more openness, the discussions at the regular monthly meeting between the governor and the chancellor are now being published, sometimes revealing wide differences of opinion between them. The Bank of System is an extremely powerful organization technically, but it is not independent politically, and the commercial banking sector is directly regulated by the Ministry of Finance through its banking bureau. Essential Vocabulary to make an unavoidable spending on

шығындарға тап болу

сталкиваться с неизбежными расходами на

to carry out one’s monetary policy

қаржы-валюта саясатын жүргізу

проводить валютно-денежную политику

the issue of banknotes and қағаз ақша мен тиындар coins шығару

выпуск бумажных денег и монет

laws and regulations

заңдар мен қаулылар

законы и постановления

to set interest rates

пайыздық мөлшерлемелерді бекіту

устанавливать процентные ставки

to protect and promote the мемлекеттің экономикаeconomic interests of the лық мүдделерін қорғау country

защищать и подвигать экономические интересы страны

to increase the bank’s effective power

банктің тиімді өкілеттілігін арттыру

повышать эффективно полномочия банка

to have the final say on

бірнəрсеге қатысты соң- иметь решающее слово в ғы шешім айту чем-либо

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to be explicitly political

еш күмəнсіз саяси болу(қызмет)

быть без сомнения политической (должность)

day-to-day dealings

күнделікті операциялар, келісімдер

ежедневные операции, сделки

to reveal wide difference of opinion

пікірдегі / көзқарастағы раскрыть существенные айтарлықтай айырмашы- различия во взглядах лықтарды табу

to disagree with government policies

үкіметтің жаңа саясатымен келіспеу

не соглашаться с новой политикой правительства

Tasks: 1. Read the text “Banker to the Government”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What are the functions of any central banking authority? 2. Do the central banks have the rights to interpret government policy? 3. Is it possible that the Central Bank of a country would be able to protect and promote the economic interests of a country? 4. Can you give some additional information on the Federal Reserve System of the USA? 5. What is the difference between the FRS and the Bank of England?

The Banque de France is another example of a dependent central bank. A banking act of 1984 set up a banking THE BANQUE DE FRANCE commission which was independent of the central bank. As a concession to the Banque, the governor’s of the Banque de France is chairman of the commission. These two bodies settle policy: the Banque’s role is simply to implement it. As in the UK, there has been pressure in France to give the Banque a more powerful and independent role. In some countries the central (national) bank has in effect, no freedom of action at all. It is simply an extension of the Ministry of Finance, carrying out its day-to-day policy. In such cases (particularly Text 8

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in newly emerging countries) the relationships is very clearly illustrated by the fact that the Minister of Finance usually heads the bank as well. Central (national) banks today are mostly state-owned institutions. Even in the most developed countries, there is rarely any suggestion that the central bank should be owned and run by private investors as a normal corporation. This was not always the case. The Bank of England was set up by private individuals as banker to King William III in 1694. In return for cash, the King gave the Bank the government’s account. Eventually, the Bank assumed all the functions of a central bank, through ownership remained in private lauds until 1964, when it was nationalized by the immediate post-war Labour government. Where central banks have private shareholders, these are usually the commercial banks, and there are usually the commercial banks, and there are strict rules about shareholdings, dividends, etc. In such cases, they are best describes as legally private but functionally public. When a government gives autonomy to its central bank, it can generally do so in the confidence that its policies will be furthered by the chairman or governor and his board. They are appointed by the government of the day, and are generally high-profile individuals from the industrial and financial communities. The Chairman or governor may be a political appointee. That’s why control lies with the government, which will not renew a term of office when it expires if it thinks the governor has stepped out of line. The dismissal of the head of the head of the central bank during his or her term is unusual, but new governments with different political philosophies often appoint a new head at the first available opportunity. In recent years the powers of central banks have tended to strengthen as governments have come to realize that an effective central banking authority can make an important contribution to a country’s overall economic growth. Where banks are free from political interference, at least in the short term, they are able to operate at maximum efficiency and flexibility using international market conditions to their best advantage to mountain the value of the country’s currency in relation to others, as well as pursuing sound domestic monetary policies. The structures of central (national) banks are as diverse as the countries themselves. It is worth noting that the Bank of England and the Bank of Japan are centralized institutions. The FRS of the USA is a mixture of private and public elements. 83

Essential Vocabulary to play a more powerful and independent role

барынша ықпалды жəне дербес рөл атқару

играть боле влиятельную и независимую роль

to own and run a bank

банкке иелік етіп, оны басқару

владеть и управлять банком

to assume all the functions орталық банктің барлық of a central bank қызметін өзіне алу

взять на себя все функции центрального (национального) банка

to give autonomy to a bank in the confidence that

бірнəрсеге сенім артып, банкке дербестік беру

предоставить банку самостоятельность, надеясь, что …

to step out of a line

белгіленген норма шегінен шығу

выйти за пределы установленных норм

to renew a term of office

өкілеттілік мерзімін жаңарту

возобновить срок полномочий

high-profile individuals

беделді тұлғалар

влиятельные лица

to strengthen the powers of banks

банк өкілеттілігін нығайту

укрепить полномочия банков

to make an important contribution to

бірнəрсеге маңызды үлес қосу

внести важный вклад в…

to be free from political interference

саяси араласудан азат / тəуелсіз болу

быть свободным от политического вмешательства

to operate at maximum efficiency and flexibility

барынша тиімді жəне икемді жұмыс жасау

работать при максимальной эффективности и гибкости

Tasks: 1. Read the text “The Banque de France”. Write out and memorize unknown words and word combinations. 2. Translate the text into Kazakh/Russian. Answer the following questions: 1. Are there any examples when the Minister of Finance heads the central (national) bank and carries out its day-to-day policy? 2. When are central banks described as legally private but functionally public? 3. What may happen if the Chairman or a governor is a political appointee? 4. Why the powers of central banks tended to strengthen? 5. When are central banks able to operate at maximum efficiency and flexibility?

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After banking and insurance, the financial sector with which the general public is most familiar is the stock market. THE WORLD’S STOCK But even in the most developed industrial MARKETS countries only a relatively small proportion of the population invests personally and directly in the industrial, commercial and financial enterprises which play an important part in everyday life. Most people, however, participate indirectly in stock markets through the large corporations, the so-called ‘institutional investors’, who run insurance companies, pension funds and other financial operations. Stock markets are the same as any other market : what are bought and sold in them are parts of companies or shares, as they eventually came to be called. The business developed in the early days of international trading, in the 17th century when the first slipping entrepreneurs in the great trading nations of England, Holland, and Portugal started to put money together to pay for sailing ships to venture overseas and bring back produce for sale. Very few people had enough money to support the total cost of a venture, so they offered a share in the profits to anyone who would put up part of the money required in advance . They were also looking to share the risk involved, so that if, say, the ship was lost they would not have to carry all the cost and would have other ventures which would bring in enough profit to cover any losses. If is from these beginnings where traders met to do business in the coffee houses of London and Amsterdam that modern stock exchanges developed. The world’s stock markets today have highly regulated structures. They operate under specific, and sometimes very different rules as to the kinds of companies that can be traded, what criteria must apply before a quotation is granted, how new companies are introduced to the market, and what information must regularly be made available to those who invest in a company – share holders. Each stock market has its own particular rules: some markets are very risky and unregulated or ‘speculative’ ( Hong Kong is the leading example), others quiet and controlled, with activity dominated by financial institutions rather than individuals. The major markets which balance controls and opportunities are the New York Stock Exchange commonly called Wall Street and the London Stock Exchange. Text 9

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Stock markets are true markets in the sense that anyone is free to deal in them but a fundamental difference with, say, a fruit and vegetable market is that shares can be both bought and sold (traded) and the dealer (the market trader) does not deal directly with the ultimate owner or seller of the shares but through an intermediary called a broker. Now technology creates new trading systems where brokers can keep in touch with one another by computer. Today the jobber has been replaced by the broker/dealer who transacts business via a computer terminal with other brokers or dealers . It was and is their roles that result in highly efficient trading and keen prices. Two prices are quoted : the higher is the buying price; the lower, the selling. The difference or the profit for the dealer, who also collects a commission from the investor on both purchases and sales. Originally commission rates were fixed, but this system has broken down in many markets. In practice, the largest investors can negotiate commissions. Today, business is broken down into several markets. The ‘main board’ will quote theprices of shares in those companies which are major concerns. They have stringent requirements for a quotation – a proved profits and dividend record, a certain minimum market capitalization and percentage of the equity brought into the open market, etc. Then there are secondary markets, where the rules for gaining a quotation are rather less strict. The companies listed are often smaller and do not meet the requirements for a main board listing. There exists in many markets what is called the ‘grey market’. This is strictly unofficial. New shares coming to the market may be ‘traded’ before their actual date of entry. Delivery takes place after quotation starts. Sometimes shares which have been temporarily suspended from official dealings may, in fact, have a price in the grey market. Essential Vocabulary to participate indirectly in жанама түрде қор бирstock markets жаларына қатысу

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косвенно участвовать в фондовых биржах

the total cost of

ортақ шығындар, шығын общие расходы, издержки

to offer a share in profits

пайданың бір бөлігін ұсыну

предлагать долю прибыли

to put up part of the money

қажетті ақша сомасының бір бөлігін төлеу

вносить часть необходимой суммы денег

in advance

алдын-ала

заранее

to cover any losses

кез-келген шығындарды покрывать любые пожабу / өтеу тери

to apply certain criteria

нақты өлшемдерді қолдану

to operate under certain specific rules

арнайы ережелер бойын- функционировать по ша жұмыс жасау особым правилам

available information

қолжетімді ақпарат

to result in highly efficient өте тиімді сауданың нətrading тижесі

применять определенные критерии

доступная информация явиться результатом высокоэффективных торгов

to negotiate and collect commissions

комиссиялық алымдар- обговаривать и получать ды талқылау жəне жинау комиссионные

to be temporarily suspended

уақытша тоқтатылу

быть временно приостановленным

Tasks: 1. Read the text “The World’s Stock Markets”. Write out and memorize unknown words and word-combinations. 2. Translate the text into Kazakh/Russian Answer the following questions: 1. Why do we say so that most people participate indirectly in stock markets? 2. Who are called “institutional” investors? 3. What is usually done in order to bring in enough profit to cover any losses? 4. How are the world’s stock markets regulated today? Some information about the London Stock Exchange 5. Does each stock market have its own particular rules?

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As technology has developed, the financial markets are gradually becoming THE MAJOR FUNCTIONS interlinked, though they continue principally to serve their domestic economies. OF THE STOCK The major functions of the Stock EXCHANGE Exchange, in general, are: It provides a market where investors can buy and sell securities; It helps to ensure that the price of a deal is fair; The companies and others who wish to raise capital can easily do so at the ready secondary markets; The investors short-term savings are prone to meet long term needs for finance from companies, the government and other organizations. Let’s describe the way how to make money in the Stock Market. Investors buy stock for one simple reason: to make money. The surest way to earn money from investing is to create as diverse a portfolio as possible and hang on to it for a long time. To succeed at making money investors need good sources of information. Much information is supplied by stockbrokers. They study market reports and get information on the forecasted financial performance of companies. Brokers usually recommend opportunities or provide special services such as newsletters: For this brokers charge additional fees. Sometimes investors prefer to avoid high brokerage fees. They implement their own investment strategy. Serious investors subscribe to investment newsletters and carefully study the stock market. A simpler investment strategy is to choose some reliable blue chip stocks and stick to them. This strategy is safe and can earn money over the long run. Investors should avoid making common mistakes which are: 1) failure to diversify; 2) paying too much for a stock which would not go up; 3) not knowing when to sell a stock going down; 4) paying too much attention to rumors and tips. There are also several techniques of predicting the stock prices. Most investors begin with fundamental analysis which is the process of a comparing a company is current financial position and future prospects with those of other firms in the same or different industries. Some investors usually try to identify a specific stock’s behavior charting it over time and then predicting it future price movement. Other investors believe that prices are random. The random walk theory Text 10

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is based on the assumption that future stock prices are independent of past stock prices. A group of investors may adopt an unusual approach, contrarianism, which holds that the market will move in the direction opposite to that predicted by the general public. Within the general trend in a stock market the prices of individual shares fluctuate constantly, depending on supply and demand. When there is strong demand, dealers may be prepared to raise the price they pay for a share because they can sell on at a better price. This could happen when a company announces better- than- expected profit figures and raises its dividend to investors. There are general conditions which can stimulate or depress share prices. If the economy of a country is in a healthy state, share prices may rise without any particular good news to push them up. The government may issue figures showing that output is rising and dealers may them take the view that this will show up in company profits in the future. The generic term for the wide variety of stocks and shares offered by stock markets today is “securities”. They represent what is known as the capital in a company. Investors are the owners of the capital and of the company. The term “stock” or “share” are interchangeable. Today, technological development has meant has there is an increasing trend towards “scrip less” trading which simply means that the shareholder does not receive a paper share certificate at all: ownership is simply recorded on a register. When looking at the stock market and the types of stocks and shares offered, it is usual to divide the market into two: the loud market and equity and other forms of a company and risk capital. Broadly louds carry a fixed rate, of dividend or interest. That on risk capital varies with the profitability of the company. Essential Vocabulary to gradually become interlinked

бірте-бірте өзара байланысты бола бастау

to buy and sell securities

құнды қағаздарды сатып покупать и продавать алу жəне сату ценные бумаги

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постепенно становиться взаимосвязанным

short-term savings and long-term needs

қысқа мерзімді жинақтар мен ұзақ мерзімді қажеттіліктер

краткосрочные сбережения и долгосрочные нужды

to avoid high brokerage fees

жоғары комиссиялық алымдардың алдын алу

избегать высоких комиссионных

to hang on smth

бірнəрсені ұстану, қолдану

придерживаться, следовать чему-либо

to earn money over the long run

ұзақ уақыт бойы ақша табу

зарабатывать деньги в протяжении долгого времени

to predict stock prices

биржалық бағаларды болжау

предсказывать биржевые цены

random prices

ретсіз, кездейсоқ бағалар

беспорядочные, случайные цены

to depend on supply and demand

сұраныс пен ұсынысқа тəуелді болу

зависеть от спроса и предложений

Tasks: 1. Read the text “The major functions of the Stock Exchange”. Write out and memorize unknown words and word-combinations. 2. Translate the text into Kazakh/Russian Answer the following questions: 1. What are the major functions of the Stock Exchange? 2. What are the roles of intermediaries as a broker, a jobber, a dealer? 3. What is the surest way to make money in the stock market? 4. What do investors do if they want to avoid brokerage fees? 5. What are common mistakes usually made by investors? 6. What is contrarianism based upon theoretically? 7. Give some additional information about the bond market and equity?

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In finance, speculation is a financial action that does not promise safety of the initial investment along with the return on SPECULATION IN the principal sum. Speculation typically FINANCE involves the lending of money or the purchase of assets, equity or debt but in a manner that has not been given thorough analysis or is deemed to have low margin of safety or a significant risk of the loss of the principal investment. The term, “speculation,” contrasts with the term “investment,” which is a financial operation that, upon thorough analysis, promises safety of principal and a satisfactory return. In a financial context, the terms “speculation” and “investment” are actually quite specific. For instance, although the word “investment” is typically used, in a general sense, to mean any act of placing money in a financial vehicle with the intent of producing returns over a period of time, most ventured money – including funds placed in the world’s stock markets – is actually not investment, but speculation. Speculators may rely on an asset appreciating in price due to any of a number of factors that cannot be well enough understood by the speculator to make an investment-quality decision. Some such factors are shifting consumer tastes, fluctuating economic conditions, buyers’ changing perceptions of the worth of a stock security, economic factors associated with market timing, the factors associated with solely chart-based analysis, and the many influences over the shortterm movement of securities. There are also some financial vehicles that are, by definition, speculation. For instance, trading commodity futures contracts, such as for oil and gold, is, by definition, speculation. Short selling is also, by definition, speculative. Financial speculation can involve the buying, holding, selling, and short-selling of stocks, bonds, commodities, currencies, collectibles, real estate, derivatives, or any valuable financial instrument to profit from fluctuations in its price, irrespective of its underlying value. Some speculation is necessary and unavoidable, for in many common-stock situations, there are substantial possibilities of both profit and loss, and the risks therein must be assumed by someone.” Many long-term investors, even those who buy and hold for decades, Text 11

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may be classified as speculators, excepting only the rare few who are primarily motivated by income or safety of principal and not eventually selling at a profit. Speculating is the assumption of risk in anticipation of gain but recognizing a higher than average possibility of loss. The term speculation implies that a business or investment risk can be analyzed and measured, and its distinction from the term Investment is one of degree of risk. It differs from gambling, which is based on random outcomes. There is nothing in the act of speculating or investing that suggests holding times, have anything to do with the difference in the degree of risk separating speculation from investing. Essential Vocabulary initial investment

бастапқы инвестиция

начальное инвестирование

to give thorough analysis

мұқият талдау жүргізу

проводить тщательный анализ

to be deemed

саналу

считаться

low margin of safety

қауіпсіздіктің төмен деңгейі

низкий уровень безопасности

to be associated with market timing

нарық мерзімін таңдаумен байланысты болу

быть связанным с выбором времени рынка

an unavoidable process

болмай қалмайтын үдеріс

неизбежный процесс

to profit from fluctuations in prices

бағалардың ауытқуынан получать прибыль от табыс табу колебания цен

short-term and long-term investors

қысқа мерзімді жəне ұзақ мерзімді инвесторлар

to differ from gambling

құмар ойындардан ерек- отличаться от азартных шелену/ ажыратылу игр

safety of principal

капиталдың сақталуы

сохранность капитала

random outcomes

кездейсоқ нəтиже

случайный исход

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краткосрочные и долгосрочные инвесторы

Tasks: 1. Read the text “The major functions of the Stock Exchange”. Write out and memorize unknown words and word-combinations. 2. Translate the text into Kazakh/Russian Answer the following questions: 1. Why is speculation considered to be a financial action? 2. What does speculation typically involve hoping on the return of the principal sum? 3. Try to interpret the terms ‘speculation’ and ‘investment’. 4. What are the major factors that speculators may rely on? 5. Can you explain why some speculation is necessary and unavoidable?

History of trade. Trading is as old as mankind. The early civilizations of Mesopotamia or Egypt traded among INTERNATIONAL themselves and with other people. TRADE Gradually, trade routes developed over land and sea. These were used to transport spices, salt, minerals and jewels over great distances.In the 15th century Europeans started exploring the seas to find new trade routes to Asia. The Portuguese explored the coast of Africa, the Spanish, English and French set across the Atlantic and founded colonies in the New World. In the 1700s the Industrial Revolution began in Great Britain. During the following two centuries it became the most powerful trading nation in the world. The British sold goods to its colonies and received raw materials from them. During this era governments did not interfere much with free trade. As a result many owners became very rich. They kept all the money themselves and paid workers badly. In the first half of the 20th century World War I and the Great Depression led to the decline of world trade. Many governments introduced new plans to help their own companies’ workers. After the Second World War the big countries of the free world tried to improve free trade. Some have formed trading blocs that trade freely. The biggest of them are the European Union, NAFTA and South America’s Mercosur. About 150 countries are members of the World Trade Organization, an institution that sets up rules for world trade. Text 12

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Trade is the buying and selling of goods and services. The products that are exchanged are things that people grow or make, like food to eat, machines to work with or clothes to wear. Services are things that people do for others, like working in bank, caring for old people or teaching pupils. Why do we trade? Trade happens because people need or want things that they don’t have. We also trade for work that we cannot do ourselves. Trade between countries happens for the same reason. Some countries, for example, have natural resources, like coal, oil or wood which other countries might want to buy. They try to sell the goods, products or services that they have too much of to other countries. They earn money from these sales and then can buy the things that they themselves need and cannot produce on their own. Both producers and consumers profit from international trade. If countries can produce goods more cheaply than others because they specialize on them why not let them. They make more money on one side and consumers in other countries can buy goods that are cheaper. Even though many nations have a lot of different goods to export there are countries that depend only on one or two products to get money. Saudi Arabia, Kuwait and other countries of the Middle East depend on oil exports, because it is pretty much the only thing that they can sell. Poor countries in Africa depend largely on the export of tropical farm products to get money. Each year goods and services worth about 11 trillion dollars ($ 11 000 000 000 000) are traded all over the world. The biggest exporting nations are The United States, France, Germany, the United Kingdom, Canada and Japan. The difference between what a country exports and what it imports is called the balance of trade. If a country exports more than it imports we call this a trade surplus. And if a country pays more for its imports than it gets for its exports it has a trade deficit. Countries import some goods and services from abroad, and export others to the rest of the world. Trade in raw materials and goods is called visible trade in Britain and merchandise trade in the US. Services, such as banking, insurance, tourism, and technical expertise, are invisible imports and exports. A country can have a surplus or a deficit in its difference between total earnings from visible exports and total expenditure on visible imports, and in its difference between total 94

earnings from all exports and total expenditure on all imports. Most countries have to pay their deficits with foreign currencies from their reserves, although of course the USA can usually pay in dollars, the unofficial world trading currency. Countries without currency reserves can attempt to do international trade by way of direct exchanges of goods without the use of money. The (imaginary) situation in which a country is completely self-sufficient and has no foreign trade is called autarky. The General Agreement on Tariffs and Trade (GATT), concluded in 1994, aims to maximize international trade and to minimize the favoring of domestic industries’. GATT is based on the comparative cost principle, which is that all nations will raise their income if they specialize in producing the commodities in which they have the highest relative productivity. Countries may have an absolute or a comparative advantage in producing particular goods or services, because of inputs (raw materials, cheap or skilled labor, capital, etc.) weather conditions, specialization of work into different jobs, savings in unit costs arising from large-scale production, and so forth. Et most governments still pursue protectionist policies, establishing trade barriers such as taxes charged on imports, restrictions on the quantity of imports, administrative difficulties, and so on. Essential Vocabulary to develop trade routes

сауда бағыттарын дамыту

развивать торговые маршруты

to transport smth over great distances

бірнəрсені алыс қашықтыққа тасымалдау

перевозить что-либо на большие расстояния

to receive raw materials from

шикізат алу

получать, вывозить сырье из …

to interfere with

бірнəрсеге араласу

вмешиваться в

to lead to the decline

құлдырауға əкелу

вести к спаду

to improve free trade

еркін сауданы дамыту

совершенствовать/развивать свободную торговлю

to set up rules for smth

бірнəрсе үшін ереже шығару

устанавливать правила для …

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to care for smb

біреудің қамын ойлау/ қамқор болу

заботиться о ком-то

producers and consumers

өндірушілер мен тұтынушылар

производители и потребители

to profit from

бірнəрседен пайда табу

получать прибыль от …

to depend on oil export

мұнай экспортына тəуелді болу

зависеть от экспорта нефти

Tasks: 1. Read the text “International Trade”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/Russian Answer the questions: 1. Why was trading important even in the early civilizations? 2. What European states were among the first to start exploring the seas to find new trade routes? 3. What were the main factors that led world trade to the decline? 4. How can producers and customers profit from international trade? 5. Explain what is the balance of trade and a trade deficit?

International trade happens because some countries have a com-parative advantage in producing goods rather than IMPORT AND EXPORT having an absolute advantage, which means it is easier for certain countries to produce goods than others. The reasons for this comparative advantage may be because of climate; natural resources such as coal, wood, or minerals; history and development, or the political situation of the world. Most countries can produce any product, even artificially, if they are willing to invest sufficient capital. Artificial climates are created in greenhouses to grow tropical plants. The UK became a sugar producer at one period, because war prevented supplies getting through. Norway has been an oil producer since oil prices and political pressures forced them to invest the capital for North Sea production. And Japan, with few natural resources has become a major industrial nation by specializing in developing its technology. Text 13

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But only Russia and America could be really self-sufficient if they had to be, producing their basic needs without importing; so most countries have to export to pay for the imports they need. In doing this, they are concerned with two main problems, their balance of trade and balance of payments. The balance of trade between countries is the difference between the amount of visible goods they import and export. Visible goods are those you can see and touch, for example manufactures, steel, and food produce. An adverse balance of trade means the country is importing too many visible and not exporting enough, and many underdeveloped countries find themselves in this position, importing expensive technical equipment, which they need to develop their industries, and exporting basic food produce under terms of trade which are a disadvantage to them. In other words if one hundred tons of rice is the cost of one tractor, many underdeveloped countries find themselves paying two hundred tons of rice for the same tractor, as they have no power to control the terms of trade for their produce. Some developed countries also face this problem. In 1991 America warned Japan that unless she reduced her technical exports to the USA, America would prevent Japanese products from coming into the USA. The balance of payments is the difference between the products (visible) and services (invisibles, such as banking, insurance, and shipping) a country imports and exports, and also includes the money values of those visible and invisible transactions. If a country’s balance is in surplus it has exported more than it imported, if it is in deficit, then it has imported more. Because the UK is a small island with a large population and cannot produce all it needs in raw materials and food, its visible balance of trade is always adverse. But it has developed invisible exports over the centuries, in banking, shipping, and insurance services, and these invisibles help reduce its balance of payments deficit, and sometimes even put it in surplus. Since the late 1970s oil production has helped further to reduce the UK’s balance of payments problems which had been increasing since the 1950s. In 1974, for example, the UK’s balance of payments deficit was so serious that it needed help from the International Monetary Fund.

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Essential Vocabulary a comparative advantage

салыстырмалы артықшылық

сравнительное преимущество

an absolute advantage

абсолютті артықшылық

абсолютное преимущество

to prevent supplies

тауарды жеткізуге кедер- препятствовать поставгі болу кам

to produce products artificia

жасанды жолмен тауар өндіру

производить продукцию искусственным путем

to be self-sufficient

экономикалық жағынан тəуелсіз болу

быть самодостаточным, экономически независимым

the balance of trade

сауда теңгерімі

торговый баланс

the balance of payments

төлем теңгерімі

платежный баланс

an adverse balance

пассивті теңгерім

пассивный баланс

underdeveloped countries

дамымаған елдер

слаборазвитые страны

to control the terms of trade

сауда шарттарын бақылау, реттеу

регулировать, контролировать условия торговли

to develop invisible exports

көрінбейтін экспортты дамыту

развивать невидимый экспорт

Tasks: 1. Read the text “Import and export”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What concepts are at the bases of international trade? 2. What does a comparative advantage mean? 3. What does an adverse balance mean? 4. How do many underdeveloped countries have to act when they don’t have power to control terms of trade? 5. Speak on the balance of payments related to the visible products and invisible services?

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There are as many tax regimes as there are countries in the world, with the rules for individuals and companies TAXATION tailored to meet local conditions. Taxation is extremely complex. The money gathered in from taxes is usually a government’s main source of revenue. Money is also raised from the issue of government securities and national saving schemes. In these, the public is lending money to the government. Sweden, for example, has one of the highest levels of social security, protecting its citizens in many areas of life. At the same time the Swedes have one of the highest standards of living in the world, even though they face one of the heaviest levels of taxation. Taxation policy may reflect socially desirable and undesirable priorities in society. Interest on savings may be tax-free to encourage thrift. Contributions to charity may also be tax-free while other transfers of capital may be subject to tax imposed on them. Each country has its own priorities .No taxes are popular, but most people acknowledge that they are necessary. By transferring some resources to a central pool, communal projects for the common good, as pursued by a particular government can be paid for. The main kinds of taxes can be divided roughly into four groups: direct taxes on incomes; indirect spending taxes on individuals; taxes on wealth, and company taxes. In more detail these are: Income tax (national, federal or local) from earnings, fees, rents, savings, etc.; National insurance or social security contributions; Taxes on savings and investments; Indirect taxes (including sales taxes and VAT); Excise duties, which are also indirect but levied in a different way to other indirect taxes; Stamp duties; Property taxes; Capital-gains taxes; Wealth taxes; 10) Inheritance taxes (which are a form of after-death wealth tax); 11) Company taxes (both national and transnational). Text 14

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Income taxes. Taxes on income from earnings are the most obvious and immediate taxes facing most individuals. TYPES OF TAXES In most countries, the tax is progressive. The larger one’s earnings, the higher the rate of tax levied. The tax at which the highest rate is paid by the individual is known as the ‘marginal rate’. This is important when paying tax on income which may be received gross (that is without tax being deducted) because any tax eventually payable on that income is likely to be at the marginal rate. In recent years governments have tried to simplify income taxes and take the lowest earners out of the tax equation altogether. There has also been a trend away from direct taxes on income (which are unavoidable if one is earning) to indirect taxes, which are generally, though not entirely, optional. All indirect taxes on a particular good or service are levied at one rate, and are never progressive. Some countries have a global approach to taxation. This means that an individual resident in a particular country pays tax in that country on all his or her income, wherever in the world it arises. Income tax is not always levied simply at a national level. Local income taxes are favored in many countries. Local services, like national ones, have to be funded. The money may be paid for these by central government from the total tax it raises. National Insurance Contributions. In addition to income tax, citizens generally pay an additional contribution – which may be the same for everyone, but is more likely to be one related to their income – with a further contribution from the employer. When first began these payments were for specific purposes; for example, to pay basic health care, for allowances from the state in times of need, and as a contribution towards an eventual pension. In other words, it was effectively compulsory insurance levied by governments against possible future deprivation. In general, national insurance contribution or social security payment is simply an additional tax. Some of the newly emerging industrialized countries have taken a different approach, however. All workers and employers put substantial proportions of their wages into a special fund. This then accumulates. Individuals may then withdraw money for specific purposes such as housing. On retirement, the money reverts to the Text 15

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individual for his own use. It should be recognized however, that it is not a tax as such: indeed, the contributor receives tax-free interest on his accumulated funds. It is a form of compulsory saving for wage earners. No government pension is paid. Indirect Taxes – Sales and VAT. In recent years there has been a tendency in many countries to move from direct taxes on income to indirect ones on spending. These may be simple sales taxes by which a percentage is added to the final price in the shops, with the revenue raised used by local or central government. Alternatively, they may be Value Added Taxes (VAT), which are now compulsory in all EU countries. VAT is normally administered by Customs and Excise authorities. VAT, being levied at every stage of manufacture and service, is a rather different concept from sales tax. In other words, a tax is imposed as the value of the product increases at each stage of manufacture. Another difference between sales taxes and VAT is that the former tend to be levied on virtually all goods, while some items may be exempt from VAT or zero-rated. Where goods are exempt, no reclaims can be paid. A sales tax is usually fixed by central government or by local or state authorities. In many countries VAT is a kind of ready source of income to compensate for lower taxes on income. Some countries have no direct taxes on income and few indirect taxes. They may, however, impose visitors’ taxes to be paid at airports on departure, or on hotel accommodation. More common, however, are no indirect taxes except for excise duties, imposed as much for social as revenue-raising purposes. Excise duties are levied on tobacco and alcohol (including home – as well as foreign-produced beers, wines and spirits) and petrol. Punitive tax rates on imported cars and petrol are common in developing countries, for example, the aim being to discourage private motoring. Stamp duties are small taxes levied on a variety of legal contracts such as those on share and house purchases. Property taxes take a wide variety of forms. They may be a tax on the value of any property owned by an individual, though, there often exceptions for the home which is the owner’s main residence. 101

Property values may also be taken by the authorities as an indication of the general wealth of the owner. Inheritance taxes are imposed after death, more commonly called estate duty. Most countries today impose some form of them and have done so for many years. Some countries have no inheritance taxes at all and many of those that do have devised means where by the tax can be avoided altogether, normally by giving them away. It is important to stress that the assets must genuinely be given away: the former owner cannot simply give them away on paper but continue to benefit from them himself. Countries usually quite a lengthy period before a transfer of assets become tax-free. Between that and the date of death, there will be a sliding scale of tax to pay. A clear seven years is typical, though in some countries it is five. Essential Vocabulary taxation

салық салу

налогооболожение

tax payer

салық төлеуші

налогоплательщик

tax administration / authority

салық əкімшілігі

налоговая администрация

to levy taxes

салық салып, салық жинау

облагать и собирать налоги

to charge taxes

салықты есептеу

облагать, начислять налоги

tax law / code

салық салу заңдары

налоговое законодательство / кодекс

tax return

салық декларациясы

налоговая декларация

tax rate

салық мөлшері

ставка налога

tax exemption

салық жеңілдігі / салық- налоговая льгота/ освотан босатылу бождение от уплаты

tax revenues

салықтан түсетін кіріс

tax holiday

салық төлеуден уақытша временное освобождебосатылу ние от уплаты налогов

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государственные налогов

tax avoidance/evasion

салық төлеуден жалтару незаконное уклонение от уплаты налоги

tax haven

аз салық төлейтін елдер

страны с низкими налогами

tax reduction

салықты азайту

снижение налога

direct / indirect taxes

тікелей / жанама салықтар

прямые / косвенные налоги

income tax

кіріс / табыс салығы

налог на прибыль / подоходный налог

sales tax

сатылымнан түскен табысқа салынатын салық

налог на доходы от продаж

VAT (Value Added Tax)

қосымша құн салығы

налог на добавленную стоимость

property tax

жылжымайтын мүлік салығы

налог на недвижимое имущество

estate / inheritance tax

мұрагерлік салығы

налог на наследство

gift tax

сыйлыққа салынатын салық

налог на дарение

willful failure to file return

декларацияны əдейі бермеу

намеренно не подавать декларацию

Tasks: 1. Read the text “Taxation” Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. Why do we have to pay taxes? 2. Are there any legal ways to pay less tax or be exempted altogether? 3. How do we call the process when somebody pays less tax? 4. What areas of knowledge and what skills is a tax lawyer required to master? 5. How can such crimes as cheating, perjury, money-laundering, underreporting and overdeduction be related to taxes? 6. What tricks do people resort to in order to ‘dodge’ the tax authority? 7. Why do we consider tax crimes as an issue of international concern?

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Under the growing integration of financial markets, it is necessary for governments to distinguish between tax TAX EVASION AND evasion and avoidance. While the former AVOIDANCE is illegal and may carry severe penalties including imprisonment, the latter is simply the use of legal means to pay the least possible tax. One simple way of avoiding tax, for example, is to claim all tax allowances due and keep one’s coding with the tax authorities up to date. Further depending on the tax payer’s occupation, a variety of expenses may be able to be set against income before it is taxable. For example, it is open to the individual to save in tax-free schemes, rather than those on which tax is payable. Similarly, anyone in a country with a territorial system of taxation can put certain assets abroad and leave them there to make interest or profits, repatriating them as and when favourable to do so from a taxation point of view (say after retirement when income may fall and the repatriated assets therefore attract a lower level of tax than they would when working.) Putting money into trusts can also save taxes, though countries have been putting up on these recently. A trust involves setting aside, an amount of money or property which is then administered not by individuals but by trustees for the benefit of individuals, organizations, charities and so on. Overseas trusts have long been used as a means of tax avoidance and sometimes evasion. Arranging to pass on assets during your life so as to avoid inheritance tax on death is another legal way to avoid tax. So, too, is arranging maintenance payments in cases of separation or divorce in certain proportions between parent and child to minimize the tax burden. It is not uncommon for payments to children to be tax-free. Tax evasion is quite different: it is deliberately not paying tax due. It can be quite simply not paying a tax bill when it is received. It may, however, more than that, including, deliberately hiding income or concealing a capital gain which is within the ambit of that tax. The penalties for tax evasion are severe. There may be a simple fine for not filling in a return correctly, though the authorities will rarely take action if there has been a genuine mistake. Equally, however, fines may be imposed which are several times the total of the tax evaded. Severe or persistent offenders may face jail sentences. Whatever the Text 16

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penalties attempts at tax evasion continue. In the EU probably the most common form of tax evasion is not paying VAT on services. By paying cash for building or decoration, for example, the customer may avoid paying VAT and the decorator may then not declare the income, or not declare it fully. No one knows the scale of this type of tax evasion, but it is certainly widespread and has a tendency to increase if the level of VAT is raised. Those indulging in tax evasion naturally assume they will not be caught. They forget that the tax authorities have large departments dedicated to finding evaders, and a lifestyle more lavish than declared income can support will soon be detected. Generally, it is not worth taking the risk. Apart from any other consideration, a minor misdemeanor unearthed will lead to life-long scrutiny. Tax havens. Tax havens have existed as long as tax systems. Some countries have derived substantial income from attracting businesses and individuals by offering low or no taxes. It is not unusual for companies to shift their headquarters to a tax haven when they fear political hazards in the country in which they are based. For example, a number of companies have been moving out of Hong Kong, due to revert to China in 1997, for just this reason. The Bahamas, Bermuda, the Cayman Islands and the Netherlands Antilles are all popular tax havens. In Europe, Switzerland has proved attractive to foreigners, partly because of low taxes and a stable currency, partly because of its strict banking secrecy laws. Tax havens are also popular with criminals as means by which their ill-gotten gains can be ‘laundered’ and come out clean. Even banks may sometimes indulge in illegal money transactions through these centres. For the law-abiding, however, suitability of a tax haven depends on where you are resident. Anyone deemed resident in a country with a global system of taxation, will not benefit from transferring assets to a low-tax country, because all income will be liable for tax in the resident country. Where the tax system is territorial, however, there can be considerable benefits in tax havens, or indeed any investment outside the resident’s country. The tiny principality of Liechtenstein, sandwiched between Switzerland and Austria, has everything an attractive tax haven can offer – not least, enviable political and economic stability. This 105

country has been able to keep its banking secrecy absolute, indeed, as has been described ‘well-nigh impenetrable’. There are heavy penalties for breaching bank confidentiality, and the only exception allowed is by a decision of the High Court in the case of criminal offences, itself a rarity because of the burden of proof required. But in Liechtenstein there are only three banks to attract the attention of international financial authorities in the same way as Switzerland. No foreign bank has an office in Liechtenstein and none of its bank has full branches outside the country. In tax havens there are no capital taxes, no withholding taxes and no exchange control. Distribution of profits is tax-free and non-active companies pay no income tax and a very low rate of capital tax – one currency unit in every thousand, or mere 0,1%. Financial markets today are in a state of flux. Current methods of regulation may prove inadequate to control their increasing complexity and interdependency, and further international agreements such as the Basle Accord seem inevitable for other sections of the financial business if progress is to continue without undue risks. Governments must set up a series f double tax relief agreements (DTR) or treaties to ensure that individuals and companies are not taxed twice simply by accident of the location of the income. Under some DTR agreements certain types of income are taxable only in one of the countries who have signed the agreement. This is the case, for instance, in the agreement between Malaysia and Singapore, where income taxed in one country is completely tax-free in the other. The reason is the historical link between the two countries, the legacy of their common colonial past. In cases where no DTR agreement exists between countries, raising the unpleasant prospect of double taxation, there may be what is called ‘unilateral relief’: Under it, overseas tax paid may be deducted in computing the overseas income taxable in the resident’s country. In general, any individual or company should know exactly what sort of organization they are doing business with: they should also know the regulations and reserve requirements they operate under and what action they can take in the event of fraud or default. International supervision should be such as to reduce the attractions for financial companies to transfer part or all of their activities offshore. It would, of course, mean the end of the tax haven and banking secrecy. 106

It may also help to avoid further bank collapses and the growing losses and financial scandals which plague many markets. Essential Vocabulary tax evasion

салық төлеуден жалтару уклонение от уплаты налогов

tax avoidance

салық төлемеудің айласы налоговые ухищрения

a variety of expenses

əртүрлі шығындар

разного рода (всяческие) расходы

from a taxation point of view

салық жүйесінің көзқарасымен

с точки зрения налоговой системы

to minimize the tax burden

салық ауыртпалығын азайту

снизить, довести до минимума налоговое бремя

to hide income deliberately

табысты / кірісті əдейі жасыру

утаивать доход преднамеренно

penalties for tax evasion

салықтан жалтарғаны үшін жазалау

наказание за уклонение от уплаты налога

to fill in a return correctly

декларацияны дұрыс толтыру

правильно заполнить декларацию

within the ambit of some tax

белгілі бір салық көлемінде

в пределах какого-то налога

to derive substantial income from

қомақты табыс табу

извлекать существенный доход из ...

to fear political hazards

саяси қауіп-қатерден қорқу

опасаться политических рисков

ill-gotten gains

арам жолмен тапқан табыс

нечестно нажитая прибыль

to indulge in illegal money transactions

заңсыз қаржы операциялармен айналысу

заниматься (увлекаться ) незаконными валютными операциями

heavy penalties for breaching bank confidentiality

банк құпиялылығын бұзғаны үшін берілетін қатаң жаза

серьезное наказание за нарушение банковской конфиденциальности

the unpleasant prospect of қосарлы салық салудың double taxation ұнамсыз (жағымсыз) болуы

нежелательная (неприятная) перспектива двойного налогооблажения

international supervision

международный надзор

халықаралық бақылау

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Tasks: 1. Read the text “Tax Evasion and Avoidance”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What is the main difference between tax evasion and avoidance? 2. What are the main ways of avoiding tax? 3. What penalties may be used for tax evasion? 4. Why is not paying VAT considered to be one of the most common and widespread forms of tax evasion? 5. How have some countries derived substantial income from putting their assets abroad, in the so-called tax havens? 6. What are the main reasons that a number of companies have moved out of the country where they are based? 7. Why are tax havens very popular with criminals? 8. Does it depend much on the system of taxation to gain considerable benefits? 9. What done by governments to ensure that individuals and companies are not taxed twice?

The concept of insurance is simple. For a singer regular payment (a premium), a policy is issued which guarantees INSURANCE to pay compensation in the event of unforeseen loss, damage, or untimely death. Premiums can be very small in comparison with the amount paid out, because the risk of an individual claim is minute when compared with the number of people or organizations paying premiums. Not all aircrafts crash, not everyone gets robbed, breaks a leg skiing or dies prematurely from disease. There may be many thousands of single policies issued for very few claims. The insurance industry is easily the largest sector of the retail financial business, though it does not have such a high profile as sectors such as banking and the stock markets. The largest single market is in the USA, but that is mainly domestic, as are those of Japan and Germany, which is Europe’s largest market. The United Kingdom follows next in the size of its domestic turnover, but it is London which houses the international centre – Lloyd’s. Text 17

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It is important to begin any review of international insurance with Lloyd’s. Lloyd’s carries out the major part of reinsurance business worldwide. Companies in the USA, Europe, Japan or elsewhere pass on a substantial part of the risks that they have accepted to Lloyd’s. Another feature, not masque to Lloyd’s but more significant there than anywhere else, has been its willingness in the past to accept worldwide any new business where the risk is unknown. Lloyd’s claims to accept any risk (with a few exceptions, in particular long – term life and financial guarantees) at a price, depending on how risky it deems a particular venture. Today, although Lloyd’s represents only a small part of total international insurance when compared with the business done by insurance companies, it has not lost its significant role, though it is under serious threat. The flexibility and adaptability of Lloyd’s has meant that its members have been able to open up the whole industry to the profitable acceptance of new forms of risk. Among Lloyd’s pioneering policies were the first standard aviation policy; products liability; jewelers block; multiple-birth insurance; hovercraft; computer fraud; legal costs; and AFDS cover. It is fair to say that Lloyd’s continued to flourish until the late 1980s in the international competition and despite severe internal problems. As a professionally organized business, insurance was preceded only by the development of the stock market. Once people began to put up for trading ventures, the next logical step was to attempt to protect those investments in the event of loss. As with shares, early trading centered on the coffee houses of London. The first reference to Edward Lloyd’s coffee in Tower Street appeared in 1688. Three years later, the coffee house transferred, to 16 Lombard Street. In 1696 the first issue of Lloyd’s News was published. It did not survive for long. Lloyd’s List was established in 1734 as a regular weekly publication. In matter of just 40 years the serious business of insurance was underway, with the early pure gambling element eradicated when the New Lloyd’s Coffee House was established. In 1771 the First Committee of Lloyd’s was set up. At that point, Lloyd’s became the property of its subscribers. Official recognition came in March 1774, when new rooms were rented in the Royal Exchange. 109

The first insurance to be subject to a standard for of contract was marine (just as the first shares had been issued for shipping and important and export) reflecting the trading nature of 18th – century Britain. In 1779 subscribers agreed on the standard Marine Insurance Policy, which is still issued virtually unchanged today. Essential Vocabulary an insurance policy

сақтандыру полисі

страховой полис

unforeseen losses

күтпеген шығын

непредвиденные потери

to have a high profile

үлкен абыройға ие болу

иметь высокий авторитет

to be under serious threat

үлкен қауіп-қатерде болу

быть под серьезной угрозой

flexibility and adaptability

икемділік жəне бейімділік

гибкость и приспособляемость

it is fair to say

... айту орынды

справедливо отметить, что …

to be underway

даму үстінде болу

быть в процессе развития

to gain official recognition ресми мойындауға ие болу/қол жеткізу

получить официальное признание

despite severe internal problems

маңызды ішкі мəселелерге қарамастан

не смотря на серьезные внутренние проблемы

smb’s claims to accept any risk

біреудің тəуекелді өз мойнына алуы туралы мəлімдемесі

заявление кого-то принять на себя риск

to carry out reinsurance business

қайта сақтандыру опера- осуществлять операции циясын жүзеге асыру по пeрестраховке

to be issued virtually unchanged

өзгертілмеген күйінде шығарылу

выпускаться практически в неизменной форме

Tasks: 1. Read the text “Insurance”. Write out and memorize unknown words and word combinations. 2. Translate the text into Kazakh/Russian.

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Answer the following questions: 1. What is the main concept of Insurance? 2. Why is the insurance industry considered to be the largest sector of the retail financial business? 3. Why is it important to begin any review of international insurance with Lloyds? 4. What was the first insurance to be subject to a standard form of contract? 5. What factors gave Lloyd’s members a chance to open up the whole industry to the profitable acceptance of new forms of risk?

Traditionally, the four principal classes of business at Lloyd’s are marine, nonmarine, aviation and motor. A Lloyd’s LLOYD’S FOUR policy can be issued only in London from PRINCIPAL CLASSES the Lloyd’s Building in Lime Street in the OF BUSINESS heart of the financial district of the City of London. The basic aim of insurance is to provide protection against unforeseen events, which cause loss or damage to people or property. Within this definition, there is distinction: policies on the life of person (the life assured) are called assurance’. Everything else is insurance. Life assurance is protection against something which will definitely happen. Either the person will die or the policy will mature. These contrasts with insurance, where the risk the holder is protecting himself against may happen. Your house may burn down; your car may be involved in an accident, a ship may sink, twins may be born etc. Anyone taking out an assurance or insurance policy makes a payment (the premium or a series of regular payments premia to the purists) to the insurance company in return for its acceptance of the risk involved. Even when identical cover is being offered, it will not be the same for every person of organization. The more likely the risk of a company having, to pay out, the more it will charge for accepting the risk, and the higher therefore the premium will be. In life assurance, for example, and barring accidents the risk of death occurring shortly after a policy is taken out is greater the older the person involved. Therefore, the younger the policy holder is at the outset, the lower the premium. Moreover, in life assurance the premium, once fixed, Text 18

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stays at that level. It is not unusual for someone aged 70 to be paying premiums set 50 years previously. Premiums rise quite sharply with age, and a 25-years-old in normal health and in an ordinary occupation will pay only half the premium of someone starting to pay at 40, who, apart from age, is also otherwise healthy and not in a dangerous trade. Heals makes a difference. Companies today will carry a variety of medical conditions and diseases at normal rates, but there are certain serious medical conductions such as heart ailments or HIV infection, which will either be ‘loaded’ (less cover for the same premium) or carry a higher level of premium for the same cover. In some extreme cases, cover may be refused altogether, though this is rare. There is a difference, too, between the sexes. On average, women in developed societies live 7 years longer than men. They do not get the full benefit from their longevity in reduced premium but are treated age for as if they were 3 or 4 years younger than a man. This means that a 25 – years-old. Woman will pay the same premium as a 21-years – old man Differing quality of risk for identical cover also apply in insurances. People who live in areas of lugger crime and robbery pay substantially more to protect their property and contents than those where crime rates are low. Young men driving sports cars pay much higher premiums for the same cover than married women in their 30s using their car mainly to do shopping. All these risks are carefully and professionally worked out and studied by actuaries. Risks are not fixed and can alter over time, and actuaries monitor them constantly to spot changes which would justify lowering premiums to policy holders or raising them. Terms and conditions of life insurance vary so greatly as to make any attempt to cover all the options available. Historically, there have been three kinds of life policy, to which various frills and benefits have been added over the years. Essential Vocabulary to provide protection against

қорғауды қамтамасыз ету

to make a regular payment жүйелі түрде ақысын төлеп тұру

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обеспечить защиту от ... регулярно вносить оплату

to pay out insurance cover сақтандыру сомасын төлеу

выплата страховой суммы

to rise sharply

бірден көтеріліп кету

резко подскочить

on average

орташа алғанда

в среднем

to alter overtime

уақыт өте өзгеру

меняться со временем

a dangerous trade

қауіпті жұмыс түрі

опасный род занятий

life longevity

өмір сүру ұзақтығы

продолжительность жизни

available options

жарамды нұсқалар

приемлемые варианты

certain medical conductions

кейбір медициналық ұйғарымдар

определенные медицинские предписания

to justify lowering and rising pre-miums

сақтандыру сыйақысының төмендеуі мен жоғарылауын ақтау

оправдывать снижение или повышение страховых премии

various frills and benefits

əртүрлі айла-шарғы мен олжалар

всяческие ухищрения и выгода

Tasks: 1. Read the text “Lloyd’s four principal classes of business”. Write out and memorize unknown words and word combinations. 2. Translate the text into Kazakh/Russian. Answers the following questions: 1. Dwell upon the four principal classes of business at Lloyds 2. What is the basic aim of insurance? 3. Is the payment (premium) for the acceptance of the risk the same for every person or organization? 4. Is differing ability of risk for identical cover applied in insurance? 5. How do insurance companies make their profits? 6. What is the difference between term and whole-of-life policies?

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One of the greatest factors in our economy today is unemployment. Unemployment is the labor force UNEMPLOYMENT participants that have inability to find jobs. There are certain exceptions to being unemployed such as a woman who devotes her time to being a housewife or a person who is doing charity work and donating their time. An important rule of thumb before discussing how unemployment affects our economy is to remember that, to get the maximum out of the available production capacity we need to reach full employment. The types of unemployment are cyclical that is related to the business cycle, falling GDP growth, and workers who are laid off due to falling demand for labor. It is caused also by declining aggregate demand. Then there is structural that is a mismatch of labor skills with the offered job vacancies. It is cause by economic reforms and new technologies such as the car industry and by workplace downsizing and tariff or quota cuts. Frictional is another type of unemployment and is from people moving jobs or looking for their first job or rejoining the work force, this is just normal labor market turnover. Seasonal unemployment is self explanatory; examples would be Christmas jobs or fruit pickers. Arthur Okun measured the relationship of the production possibilities curve and unemployment. Okun’s law can be stated as saying that for every one percentage point by which the actual unemployment rate exceeds the “natural” rate of unemployment, there is a 2 to 4 % “GDP Gap”. That is, unemployment above the inflationthreshold unemployment rate corresponds to real gross domestic product below potential output. When a country is facing unemployment problems there are certain opportunity costs for it’s citizens, which means the economy is not running on full production frontier. These opportunity costs lead to lower living standards, consume resources, no production contribution. A decline in labor market skills causes the long term unemployed and lower wage growth. One of the reasons so many people are unemployed is DOWNSIZING. Downsizing is laying off a lot of people all at the same time. It is mostly done to increase company profits. For example AT&T laid off 40,000 people and made $16 million and IBM laid off Text 19

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60,000 people and made $2.6 million. Many large companies soon realized that they had to lay off people in smaller amounts. But I have a list of many of the companies that laid off people under the radar: Westinghouse, Honeywell, RJR Nabisco, Hewlett-Packard, US West, Wells Fargo, Kmart, Office Depot, Honeywell, Whirlpool, Lockheed Martin, First Boston, Goodyear, Sunbeam, Raytheon, McDonnell Douglas and many many others. Let’s go into more effects of unemployment economically and socially. First of all, higher unemployment causes lower real GDP, reduced national income and lower living standards. Economic and social hardships are suffered by families of the unemployed. There is also a social stigma attached to unemployment. The longer a person is unemployed the harder will be for them to ever set foot in the productive world again. The increase in the taxation burden as taxpayers must fund the social security payments. It can also lead to a less equal distribution of income. Other social costs include the rising crime rates, family breakdowns, loss of dignity, drug use and alcoholism. Essential Vocabulary rule of thumb

тəжірибелік ереже

практическое правило

to be laid off under the radar

көзге түсіп қалу нəтижесінде жұмыстан босатылу

быть уволенным попав в поле зрения

the production possibilities curve

өндіріс мүмкіндіктерінің кривая производственқисығы ных возможностей

a mismatch of labor skills with the offered job vacancies

еңбек дағдыларының ұсынылған бос орынға сай келмеуі

несоответствие трудовых навыков с предлагаемыми вакансиями

declining aggregate demand

ортақ сұраныстың азаюы

сокращение совокупного спроса

labor market turnover

еңбек нарығының айналымы

оборот рынка труда

workplace downsizing

жұмыс орындарының азаюы

сокращение рабочих мест

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tariff or quota cuts

тарифтік квотаның азаюы

сокращение тарифных квот

threshold unemployment rate

жұмыссыздық деңгейінің шегі

порог уровня безработицы

a social stigma

əлеуметтік таңба / белгі

социальное клеймо, ярлык

equal distribution of income

табыстың / кірістің тең бөлінуі

равное распределение доходов

Tasks: 1. Read the text “Unemployment”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. What is unemployment? 2. Dwell upon the types of unemployment? 3. How is the actual unemployment rate interpreted in Okun’s law? 4. What are the negative effects of certain opportunity costs for the citizens of the country? 5. What are the social consequences of long-term unemployment?

Inflation is commonly defined as an increase in some general index of prices, such as the Consumer Price Index or the INFLATION broad-based Implicit Gross National Product Deflator. In understanding inflation we should recognize the difference between increases in the prices of particular goods or services, which constitute changes in relative prices and do not necessarily represent inflation, and an increase in a general index of prices, which does represent inflation. In a market-oriented economy, at any time some prices are rising and some prices are falling. These changes in relative prices are the basic mechanism by which resources are allocated; increases in the price of some particular good or service need have no particular inflationary significance for the overall economy. Yet when an average of all prices – expressed in a price index – rises, the economic problem of inflation becomes a matter of concern. Text 20

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Why has inflation been so persistent and often severe in recent decades? There are a great variety of explanations, and it may be of interest to list some of those most commonly cited; 1. Excessive monetary growth. A close statistical relationship exists between growth of the money supply and changes in the price level. Though such association does not necessarily mean causation, many economists (so-called monetarists) consider excessive monetary growth to be the salient cause of inflation. 2. Large and continuous deficit federal spending. Since 1960 the federal budget has been balanced or in surplus only twice. The deficit spending of the other years has resulted in a huge increase in the national debt. Since increased federal borrowing tends to push up interest rates, it is possible that the Fed will respond by expanding the money supply at an excessive rate, causing inflation. (If the Fed is not thus influenced, there is no necessary reason for deficit spending to cause a large and sustained increase in the rate of inflation, as was made evident in the period of the mid- and late 1980s, when large federal budget deficits and a relatively subdued inflation rate coexisted.) 3. Externally imposed price “shocks”. The principal example here, of course, is the huge hike in oil prices since 1973. Because of the large and pervasive role of petroleum in the production of goods and services, the OPEC-mandated oil-price increases had to raise the general price level unless there were offsetting declines in other costs. Such price declines, in a modern, industrialized economy, are likely only if employment and output decline sharply – perhaps to an unacceptable degree. 4. Wages, productivity, and expectations relationships. Labor costs are the most significant component of the total costs of most goods and services. When wages rise more than productivity (output per hour of work), prices can be expected to rise. Workers have an incentive to press for such inflationary wage increases either to increase their share of the “economic pie” or, if they expect inflation, to maintain the size of their current share. Thus inflationary expectations can be selffulfilling as a “wage-price spiral” develops. Interest rates and inflation. The relationship between changes in overall prices and the level of interest rates has a comparatively simple explanation. Perhaps the best way to provide this explanation is to discuss the impact of changing prices on the financial position 117

of an individual. If interest rates were not related to changing prices, there would be a redistribution of wealth between lenders and borrowers as the result of changing prices. For example, a lender who extended a loan of $1000 would receive only $500 worth of purchasing power in principal repayment if prices had doubled since the time the loan was made. A lending rate of 100 percent (equal to the rate of inflation) for the period of the loan would be necessary for the lender merely to recapture the amount of purchasing power transferred to the borrower when the loan was made; any lesser rate would result in a loss to the lender. The borrower would thus benefit from the inflation if the interest rate was less than the inflation rate. In the example the borrower would acquire $1000of purchasing power at the time of the loan and would return to the lender only $500 of purchasing power in principal repayment. We would expect, then, that market interest rates would reflect this potential loss to the lender and gain to the borrower such that the rate would adjust upward until there was no loss to the lender and no gain to the borrower from the inflation. Such adjustment in the rate of interest would equate the purchasing power of principal received by the borrower and principal paid to the lender and provide a real return to the lender. At these rate levels, equilibrium would be established, and the inflation would not produce any inflation-induced redistribution of wealth between lenders and borrowers. Consequences of Inflation. Inflation is an economic problem because of its effects on the distribution of income, which pose equity concerns and create social and political tensions, and on the allocation of resources, which pose a threat to economic growth. During inflationary periods, real (inflation-adjusted) income tends to shift from groups that lack the market power, institutional status, legal ability, and/or foresight to keep their money incomes increasing in step with the price level to those groups that do. A powerful union, for example, may impose a cost-of-living adjustment (COLA) labor contract clause (indexing wage rates to the CPI) on management and thus protect its members from inflation. The U.S. Congress may choose to protect certain groups of recipients of government paychecks in a similar fashion, as it has done for Social Security beneficiaries, military retirees, and retired federal employees. On the other hand, such groups as state employees can only hope that state legislators will 118

choose to boost their salaries in keeping with inflation rates in a timely fashion, an action that is not always forthcoming. Inflation also tends to shift income from taxpayers to government. In the case of progressive-rate income taxes, rising money income (even if it corresponds to falling real income) will move taxpayers into higher tax brackets and may result in a greater proportion of real as well as money income being paid in taxes. In the case of corporations, corporate tax payments increase (even if profits are constant) because cost-based depreciation allowances lag behind real capital consumption. Inflation is likely to be injurious to both savings and investment. Though it can be argued that efficient financial markets impound expectations about inflation (the risk-return implications) into security prices, inflation will still discourage the flow of savings into financial assets to the extent that savers do not believe in the existence of such efficiency. Certainly, surges of “unexpected” inflation, such as the 1980 price-level spurt (which sent interest rates soaring and bond prices tumbling), persuade many individuals to plow their available funds into personal possessions (and perhaps precious stones and metals), rather than into purchases of financial assets or productive real assets. Inflation not only jeopardizes the availability of funds for investment but also tends to make most potential investment projects less attractive to business managers. Business firms undertake investment projects according to much the same risk-return decision criteria that characterize the purchase of financial assets. The prospect of continuing inflation (at uncertain rates) has a significant, and often pivotal, impact on the assessment of risk regarding proposed investment projects. Inflationary expectations thus may tend to distort the flow of funds in the economy so that money capital may e increasingly channeled into nonproductive uses. Efficiency in both the financial markets and the markets for goods and services may diminish as confidence in the future purchasing power of money wanes. Economic growth is inevitably and adversely affected by inflation when its occurrence and pace engender such behavior. Essential Vocabulary 119

to recognize the difference айырмашылықты түсіну понимать различие relative prices

салыстырмалы бағалар

относительные цены

to allocate resources

ресурстарды үлестіру

размещать / распределять ресурсы

an average of all prices

барлық бағаның орташа көрсеткіші

средний показатель всех цен

to be of great interest

ерекше қызығушылық білдіру / көрсету

представлять особый / большой интерес

to be the salient cause of inflation

инфляцияның айқын себептері

видимые причины ин-фляции

a huge increase of the national debt

мемлекеттік қарыздың айтарлықтай артуы

значительное повышение государственной задолженности

a huge hike in oil prices

мұнай бағасының күрт артуы

значительный скачок цен на нефть

a large and pervasive role of petroleum

мұнайдың қомақты рөлі

распространяющаяся роль нефти

OPEC

Мұнай экспорттаушы елдердің ұйымы

Организация стран экспортирующих нефть

employment and output decline

жұмыспен қамту жəне өнімнің төмендеуі

снижение занятости и выпуска производства

Tasks: 1. Read the text “Unemployment”. Write and memorize unknown words and word combinations. 2. Translate the text into Kazakh/ Russian Answer the following questions: 1. How is inflation commonly defined? 2. What is the difference between increases in the prices of particular goods and services and a general index of prices? 3. What relationship exists between the growth of the money supply and changes in the price level? 4. What may cause a large and sustained increase in the rate of inflation? 5. What is the most significant component of the total costs of most goods and services?

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APPENDIX Task 1. Express your own point of view using the following phrases in your speech:

To my mind …

In my experience …

In my opinion …

As far as I understand …

On the one hand, …on the other hand

From my point of view …

If my memory serves me right …

If I am not mistaken …

It seems to me that …

Personally, I think …

My personal view is that …

I am sure/certain/convinced that …

The fact is that …

This proves that …

It is obvious that …

There is no doubt that …

1. An automobile company “Daewoo” decides to open a new dealership in Kazakhstan. The manager is asked to choose all the possible positions and vacancies for a new dealership. What staff should be hired, what departments should be established? 2. You are an applicant at the interview applying for a position of human resources manager at a clothes shop. You are asked to enumerate the responsibilities of a distribution manager, production manager, sales manager and an accountant. What responsibilities can you mention? 3. Do you think working abroad is essential for a successful career? Why / Why not? Task 2. Reply to a letter referring to the following assignments and a sample letter using the words in the unit “Useful phrases in writing letters”:

You are a Director of Sales department. One of your salesmen sent you a request for promotion to the position of a sales manager. Your task is: a) thank Mr. Watkins for his letter; b) express Mr. Watkins the idea that you agree with his request to promote him; to the position of a sales manager and give reasons for that; c) settle the time for meeting in order to discuss all the details.

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REQUEST FOR PROMOTION 10.01.2015 Tom Wilson Electronics ltd. 12 South Street, Sheffield, UK 125367 Dear Mr. Wilson, As you know, I am very happy to work and contribute to Electronics ltd. under your authority. Allow me to mention an opportunity I see for greater profits. I’m confident that you will agree that my efforts as your salesman have been successful to the company; my sales in dollars for the past year were roughly $425,000, which far surpassed the $250,000 goal we anticipated at our year-end meeting twelve months ago. I would like you to know that I believe I can be of even more benefit to you and Electronics ltd. as your Sales Manager. Having had four years of experience in selling our computer software, I have gained a clear idea as to what our customers’ needs are and how we can meet them. I know how we can increase sales dramatically and I can inspire our sales team to do precisely that. As your Sales Manager, I truly believe that we can achieve in excess of $10,000,000 in sales by the year 2020. I understand that you are a very busy person. I will thus be delighted to meet with you at any time you please to discuss my request. Cordially, Dave Watkins

Task 3. Express your own point of view using the following phrases in your speech:

To my mind …

In my experience …

In my opinion …

As far as I understand …

On the one hand, …on the other hand

From my point of view …

If my memory serves me right …

If I am not mistaken …

It seems to me that …

Personally, I think …

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My personal view is that …

I am sure/certain/convinced that …

The fact is that …

This proves that …

It is obvious that …

There is no doubt that …

1. Does advertisement influence people? Whom is advertisement aimed at? Why? 2. What TV commercials can you watch on TV every day? What goods / services are advertised more frequently than others? What is your favourive TV commercial? Why? 3. You are the Marketing Manager of a clothes producing company. Think of an advertisement campaign that you can launch to advertise your clothes. 4. What everyday problems do people who work at finance departments of international companies have? 5. How often do you work on a computer? How does computer help you at your work / study? 6. What are some common computer problems that people encounter when running their machines, and what issues can cause them? When you encounter such problems, what do you do to resolve them: seek help from a friend, consult a computer store, or read a computer book or magazine? Task 4. Write a letter using the words in the unit “Useful phrases in writing letters”:

You are the Supply Manager of the Engineering Company. You need 600 computers for your company and you found information about Dell Computer Corporation (Russia) and decided to write them a letter. In your letter do the following: 1) write a letter to Mr. Hopsky – Distribution Manager, Company address: 34, Leninsky Prospekt, Moscow, Russia, 452450. 2) ask about the price and models of computers; 3) ask about discount or offer in return for buying a large amount of computers; 4) ask about corporate software and service. Task 5. Write a letter invitation referring to the following assignments and using the words in the unit “Useful phrases in writing letters”:

You are a Chief Executive Officer of Welldone Computer Corporation. On June 21, 2016 your company holds a business conference dedicated to the issues of Computer Technologies in Economics. a) write an invitation letter to your partner Yan Kim who works for Samsung as a Financial Director; b) ask him to take part in the conference; c) express your hope for the future cooperation. Task 6. Express your own point of view on the following:

1. Comment on the expressions “Money makes money”, “Time is money”, “Money never sleeps”.

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2. Where can people keep money and what is the role of inflation in it. 3. Imagine you have $1000000. What projects would you like to invest this sum of money into? What return would you expect? 4. What is inflation? How does it influence ordinary people? 5. Why are prices different in various shops? 6. Imagine you own a food chain store? The price for petrol rose by 5%. What can you do to minimize expenses? Task 7. Lodge a complaint against the company referring to the following assignments and using the words in the unit “Useful phrases in writing letters”:

You bought a lap-top computer. In three months your computer broke down but you have a warranty period of one year. You gave in the computer to the Service Department. You were promised to get your computer ready within 2 weeks but in 2 months you still did not get your lap-top computer. Write a complain letter to the company Computer International for Mr. Lee. Task 8. Making Economic Decisions

In the following activity you will be asked to play the role of a speaker scheduled to appear at a hearing conducted by your local government. The purpose of the hearing will be to discuss one of the issues indicated below. Before your presentation, you will want to do some research on the issues, so that you will be able to make the best impression possible. The teacher will assign you a specific role and issue from the lists below. Prepare a position statement and present it to the class. Several students will be taking a different role in regard to the issue they are assigned. The class members should make a list of pros and cons that they detect in each speaker’s presentation. Then they can share their reactions as if they were active participants at a town meeting where the hearing is being held. Roles: – mayor – representatives of the senior citizens council – member of the city council who has pledged not to raise taxes – superintendent of schools – labor union officials – member of the city council who is pledged to build recreational facilities – representative of POW (Protect Our Wildlife), an influential environmental group – bank president – home builder Issues: A local builder wants to build a small subdivision of about 20 houses on land now used as a bird sanctuary. He is asking the council to change the zoning and extend the city sewer system into this area. It will cost the city US $2.3 million to extend water

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and sewer service to this area. It is estimated that the town would receive an additional US $75,000 in taxes annually if he land were to be replaced by 20 homes. Additional growth in the area would generate even more income for the city. It is proposed that the city sales tax (now 5 percent) be increased to 6 percent. The revenue from this tax increase will be used to build a park, a bike path and a community center. The city-owned bus system has been losing money for several years, and the equipment is in very bad shape. It is suggested that the city raise property taxes by 10 percent on houses worth more than US $75,000 and use the additional revenue to buy new buses. With new equipment and better service it is hoped that more people will use the bus system. A large company is going to build a computer assembly plant that will employ several hundred workers. The company will locate the plant near your city if the city will lease them a building for US $1 per year for 99 years and provide various tax breaks. Other communities in your state have offered such assistance to the company. From your point of view, would the economic benefits of having a new business in town offset the tax revenues and rent given up by the city? Task 9. Using the structure given below create your own CV:

Arman Aidyn 55 Al-Farabi Almaty, 101 Phone (8727) 3564 -781 E-mail: [email protected] Personal Information Marital status: Married Nationality: Kazakhstan Work experience 2008 - Present / Alser LTD. / Almaty Manager Responsibilities: – Provide helpful service to customers concerning update computers – Design and implement computer based tools using Microsoft Access and Excel for staff – Monthly bookkeeping – Suggest changes in product offerings on a quarterly basis based on detailed analysis of sales patterns

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2005 - 2008 / LG Company / Astana Assistant Manager Responsibilities: – Managed warehouse operations – Programmed Excel spreadsheet implemented to control sales strengths and weaknesses on quarterly basis – Interviewed new applicants for open positions – Travelled locally offering on-site visits to regular customers – Supervised bookkeeping staff Education 2001 - 2005 / al-Farabi Kazakh National University / Almaty Bachelor of Business Administration Four year business administration course focusing and retail work environments Additional Skills Advanced level skills in Microsoft Office Suite, basic HTML programming, spoken and written proficiency in Kazakh, Russian and English References available upon request Useful phrases in writing letters Confirmation of the receipt of a letter

Хатты алғанын растау Подтверждение получения письма

We have received your letter of...

Біз Сіздің ... хатыңызды алдық

We thank you for your letter of...

Жазған хатыңыз үшін Благодарим Вас за Ваше алғысымызды білдіреміз письмо от... (дата)

References to the previous letters

Алдыңғы жазылған хаттарға сілтеме

Мы получили Ваше письмо от...(дата)

Ссылки на предыдущие письма

In reply to your letter of... Сіздің хатыңызға жауап we are pleased to inform ретінде ... Сізге қуана you that... хабарлағымыз келеді

В ответ на Ваше письмо от... мы рады сообщить Вам, что...

In accordance with your request of...

Сіздің сауалыңызға/сұрағыңызға сəйкес ...

В соответствии с Вашим запросом от... (дата)

We confirm our telex of... which reads...

... жөнінде жазылған біздің телексті ... растаймыз

Мы подтверждаем наш телекс от..., в котором говорится о...

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Further to our letter of... we...

Біздің тарапымыздан жа- В дополнение к нашему зылған хатқа қосымша письму от... мы... ... біз...

Asking and informing

Сұрақтар, хабар беру/ мəлімет беру

Вопросы, осведомления

I would be glad to know ...

Мен ... жөнінде білсем жақсы болар еді

Я был бы рад узнать...

Could you please tell me... Өтінемін, маған ... хабарлаңызшы

Будьте добры, сообщите, пожалуйста...

Please let me know if...

Өтінемін хабарласыңыз, Пожалуйста сообщите, егер... если...

May I hope for...?

... сенім артуға болады ма?

Могу я надеяться на...?

We would be very much obliged if you could inform us...

Егер бізді хабардар етсеңіз, шексіз риза болар едік

Мы будем очень рады, если Вы сможете известить нас

I would be grateful if you Егер сіз не ... жəне қаcould let me know what... шан екені жайлы хабарand inform me when... лассаңыз, Сізге алғысымыз шексіз болар еді

Я был бы весьма благодарен Вам, если бы вы сообщили, что... и когда...

We would be very much obliged if you could give us a short explanation...

Егер Сіз бізге қысқаша Мы были бы крайне түсіндірсеңіз ... өте риза благодарны Вам, если болар едік бы вы кратко пояснили нам...

Information and announcements

Хабарлар, хабарламалар

We are informing you that Біз Сізге ... (туралы, (of, about)... жайлы, жөнінде) хабар жіберіп отырмыз We are pleased to inform you...

Сообщения, извещения Мы сообщаем Вам, что (о)...

Сізге қуана хабарлаймыз Рады сообщить Вам...

May we remind you that... ... Сіздің есіңізге түсіру- Разрешите напомнить ге рұқсат етіңіз Вам...

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We have to inform you...

Сізге ... хабарлауға мəж- Вынуждены сообщить бүрміз Вам...

We intend to...

Біз ... ниеттіміз

Мы намереваемся...

Permit me to say that..

... айтуға рұқсат етіңіз

Позвольте сказать, что...

Let me inform you that...

... хабарлауға рұқсат етіңіз

Позвольте сообщить, что...

This is to inform you that...

... осымен Сізге хабарла- Настоящим сообщаю, ғым келеді что...

This is to certify that...

... осымен куəландырылады

Настоящим удостоверяется, что...

It is important to us that...

.. біз үшін маңызды

Для нас важно, чтобы...

Please take due note that... ... Сізді хабардар етемін

Ставлю Вас в известность, что...

I am writing to confirm that...

... растау үшін жазып отырмын

Пишу, чтобы подтвердить, что...

As you know...

Өзіңіз білетіндей ...

Как Вам известно...

We wish to draw up your attention to the fact that...

Сіздің көңіліңізді ... аударғымыз келеді / Сіздің ... ескергеніңізді қалаймыз

Обращаем Ваше внимание на то, что...

Enclosed please find...

Қосымша берілген параққа назар аударыңыз ...

Приложено к письму...

Assurances, assistance and services

Сендіру, көмек жəне қызмет ұсыну

Уверения, предложения помощи, услуг

We shall do our best to...

... үшін қолымыздан келгеннің барлығын жасаймыз

Мы сделаем все возможное, чтобы...

Please let me know if you Қосымша ақпарат неrequire any further infor- месе көмек керек болса, mation or assistance. хабарласуыңызды өтінемін.

Сообщите, пожалуйста, если Вам потребуется дальнейшая информация или помощь.

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We will be glad to answer ... қатысты кез-келген any technical questions техникалық сұрақтарға on the... жауап беруге əзірміз.

Мы будем рады ответить на любые технические вопросы относительно...

Expression of hope

Сенім білдіру

Выражения надежды

I hope that all is going well with...

... барлығы жақсы болады деп сенемін

Я надеюсь, все идет хорошо с...

I hope you will not mind... ... Сіз қарсы болмайды деп сенемін

Я надеюсь, Вы не будете возражать...

I do hope I am not putting Сізді көп əуреге салyou to too much trouble маймын деп ойлаймын if... егер ...

Я надеюсь, я не очень потревожу вас, если …

I look forward to cooper- Осы жаңа кəсіпорында Я рассчитываю на сотating with you on this new сізбен істес болуды асы- рудничество с Вами в venture. ға күтемін этом новом предприятии Requests

Өтініштер

Просьбы

We shall (should) be pleased...

Риза болар едік ...

Мы будем рады...

We should be obliged if you could (would)...

Егер Сіз ..., біз дəн риза болар едік

Мы были бы Вам признательны, если Вы...

We would be glad if you... Біз риза болар едік егер сіз...

Мы были бы рады, если Вы...

In view of the urgency we Шұғыл/қауырт жағдайға В связи со срочностью ask you to... байланысты біз Сізден ... мы просим Вас... өтінеміз Please let me know...

Өтінемін, хабарласыңыз...

Пожалуйста, сообщите...

Please send us...

Бізге ... жіберуіңізді сұраймыз

Просим выслать нам...

Please inform us about...

... жайлы хабарлауыңыз- Просим Вас сообщить ды сұраймыз нам о...

We request to pay...

... ақысын төлеуді өтінеміз

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Просим оплатить...

Please indicate your postcode, telephone and telex number.

Пошта индексін, телефон нөмірі мен телексті көрсетуіңізді өтінемін

Пожалуйста, укажите Ваш почтовый индекс, номера телефона и телекса.

Please take all necessary measures for...

... үшін барлық тиісті шараларды қолдануыңызды сұраймын

Прошу принять все необходимые меры для...

I wonder if you could help Маған көмектесе алаme to... тындығыңызды білгім келеді

Хотелось бы знать, не можете ли Вы мне помочь...

It will be appreciated if you will please...

Алғысымызды білдірер едік, егер Сіз ...

Мы будем благодарны, если Вы...

We ask you for some additional information...

Сізден біршама қосымша ақпарат беруіңізді сұраймыз

Просим у Вас некоторую дополнительную информацию о...

Could you please send me...

Маған жіберуіңізді өтінемін

Будьте добры, пришлите мне пожалуйста...

In accordance with law I request...

Заңға сəйкес талап етемін ...

В соответствии с законом я прошу (требую)...

I (we) would (should) be most (extremely) grateful if you could...

Егер Сіз ... алсаңыз, шексіз риза болар едім

Я был бы весьма благодарен, если бы Вы могли...

Gratitudes

Алғыс, ризашылық

Благодарности

It is very kind of you to...

...көрсеткен ілтипатыңызға көп рахмет.

Очень любезно с Вашей стороны...

I am writing to thank you very much indeed for...

Сізге ... үшін рахмет айту / алғыс білдіру үшін жазып отырмын

Пишу, чтобы поблагодарить Вас за...

May I take this opportunity of thanking you for...

Сіздің ... үшін рахмет айтуға / алғыс білдіруге осы мүмкіндікті пайдалануға рұқсат етіңіз.

Позвольте воспользоваться случаем, чтобы поблагодарить Вас за...

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Thank you for contributing so much to...

Қосқан үлкен/қомақты үлесіңіз үшін алғысымызды білдіреміз

Благодарим за столь большой вклад в...

I sincerely appreciate your Мен Сіздің ізгілігіңізді / Я высоко ценю Вашу kindness... жақсылығыңызды жоға- доброту... ры бағалаймын Please accept my sincere (deep) appreciation for your help.

Көрсеткен көмегіңіз үшін менің шын (шексіз) алғысымды қабыл алуыңызды сұраймын.

Примите, пожалуйста, мою искреннюю (глубокую) благодарность за Вашу помощь.

I wish to express my appreciation for all your efforts...

Барлық күш-жігеріңізді жұмсағаныңыз үшін алғысымды білдіргім келеді

Хочу выразить мою благодарность за все Ваши усилия...

I am most grateful to you for helping me.

Көрсеткен көмегіңіз үшін үлкен алғыс айтамын.

Я очень благодарен Вам за помощь.

I am truly grateful for your advice.

Сіздің ақыл-кеңесіңіз үшін шексіз ризамын.

Я искренне благодарен за Ваш совет.

This is to thank you again Сіздің тамаша қонақfor your wonderful hospi- жайлылығыңыз үшін tality… тағы да алғысымды білдіру үшін жазып отырмын

Пишу, чтобы поблагодарить еще раз за Ваше гостеприимство…

Expressions of regret

Өкініш білдіру

Выражения сожаления

Unfortunately,...

Өкінішке орай, ...

К сожалению,...

Unfortunately, I have been Өкінішке орай, мен ... out on business in... қызметтік сапарда болдым

К сожалению, меня не было - я был в деловой поездке в…

I am very sorry to have caused you so much trouble.

Сізді сонша əуреге салғаным үшін кешірім өтінемін

Я очень сожалею, что причинил Вам столько беспокойства.

I am afraid that...

Мен ... уайымдап отырмын

Боюсь, что...

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I am sorry (I regret) to say (to inform you, to tell you) that...

... айтуға (сізге хабарлау- С сожалением сообщаю, ға, сізге айтуға) кешірім что... өтінемін (Өкінішті)

I regret to inform you that...

Өкінішке орай, Сізге ... хабарлауға мəжбүрмін

К сожалению, вынужден сообщить Вам, что...

To my great regret, I must Өкінішке орай, мен сізге К моему великому сожаinform you that... ... хабарлауға міндетлению, я должен известімін тить Вас, что... ...I am not able to...

Мен ... жасай алмаймын /

...я не в состоянии...

Apologies

Кешірім сұрау

Извинения

We apologize for...

Біз ... кешірім сұраймыз

Мы извиняемся за ...

Please accept our apologies for...

... үшін біздің кешірімімізді қабыл алуыңызды сұраймыз

Пожалуйста, примите наши извинения за...

My (our) apologies for...

... үшін мен (біз) кешірім Приношу свои (наши) сұраймыз извинения за...

We offer an apology for...

... үшін кешірім сұраймыз

Приносим извинения за...

I wish to offer my sincere apologies for...

... үшін шын ниетіммен кешірім сұраймын

Хочу принести свои самые искренние извинения за...

I am sorry that...

Кешірім етуіңізді сұрай- Прошу извинить за то, мын что...

I must apologise that...

... үшін кешірім сұрауға міндеттімін

Должен извиниться за то, что...

I sincerely regret that...

Мен ... үшін шынымен өкінемін

Я искренне сожалею, что...

I was extremely sorry that...

Мен ... үшін өте өкінішті Я очень виноват в том, что...

I am sorry, but I cannot be Кешіріңіз, бірақ мен сіз- Извините, но я не могу of assistance to you in this дің бұл ісіңізге көмекте- помочь Вам в этом деле. matter. се алмаймын.

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Expressions of delight

Разылық білдіру

Выражения удовлетворения

I take pleasure of...

Қуана-қуана ...

С удовольствием...

We are delighted that...

... біз қуаныштымыз

Мы очень рады, что...

I shall be happy to discuss Оны Сізбен бірге талқы- Буду счастлив обсудить with you... лағанға риза боламын с Вами... I am pleased to send you a Сізге бір үлгісін жіберу- Рад выслать Вам экземcopy of... ге дайынмын/əзірмін пляр... We are pleased to learn from your letter that you have decided to...

Сіздің хатыңыздан ... қабылдаған шешіміңіз туралы біліп қуанып қалдық

We are most pleased that you want to buy...

Сіздің ... сатып алуға Мы очень рады, что Вы ниет білдіргеніңізге қуа- пожелали купить... ныштымыз

I was delighted to hear the ... жайлы жаңалықтарnews that... ды естіп, мен қуанып қалдым It would be truly wonderful to...

Нам было приятно узнать из Вашего письма, что Вы решили...

Я был восхищен, узнав, что...

... шынында керемет бо- Было бы действительно лар еді... замечательно...

We are glad to say that we Арнайы сіз үшін ... қалcan reserve for you... дыра алатынымызды қуана хабарлаймыз

Мы рады сообщить, что можем оставить за Вами...

We appreciate your attitude.

Біз сіздің ұстанымыңыз- Мы ценим вашу позиды /көзқарасыңызды цию, отношение ерекше бағалаймыз

Expressions of disappointment

Разы болмау/қанағаттанбаушылық білдіру

Выражения неудовлетворения

I am most disturbed that you will not be able to...

Сіз ... жасай алмайды деп мен қатты алаңдаймын

Я очень обеспокоен тем, что Вы не сможете...

This sets up a chain inБұл біршама қиындықvolving several complica- тар тудырады tions.

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Это вызывает цепь определенных затруднений.

We are not happy about the terms you suggested.

Сіз ұсынған шарттармен Мы не удовлетворены біз келісе алмаймыз предложенными Вами условиями.

I simply cannot underНеге бізге алдын-ала Я просто не могу поstand why you did not tell ескертпегендеріңізді мен нять, почему Вы не us... түсіне алмаймын предупредили нас... I am very disappointed about this fact, and hope that you can help me to clear out this very strange situation.

Мен бұл мəселе туралы қатты қапалымын, жəне бұл қиын жағдайдың анық-қанығын сіздер түсіндіріп береді деп сенемін.

Я очень огорчен данным обстоятельством и надеюсь, что Вы объясните мне эту весьма странную ситуацию.

By this letter I emphatically protest against…

Осы хат арқылы мен ... үзілді-кесілді қарсы екендігімді білдіремін

Настоящим письмом я заявляю категорический протест против...

This is, I am sure you will Бұл, сіз келіседі деп ой- Это, полагаю Вы соagree, not a good way to лаймын, іс жүргізудің ең гласитесь, не лучший conduct business. тиімді тəсілі емес. способ вести дела. I am afraid that we must cancel the agreement as...

... болғандықтан, келісімді бұзуға тиіспіз деп ойлаймын

Я боюсь, мы должны расторгнуть договор, поскольку...

We emphatically deny you Біз сіздің ... үзілді-кесіл- Мы категорически запpermission to... ді тыйым саламыз рещаем Вам... Responses to requests and offers

Сұрақтар мен ұсыныс- Ответы на вопросы и тарға жауап беру предложения

We were very pleased to ... біздің жарнамаға receive your letter in reply жауап ретінде Сізден to our advertisement in... хат алғанымызға дəн ризамыз

Мы были очень рады получить от Вас письмо в ответ на наше объявление в...

We much appreciate your offer...

Біз Сіздің ұсынысыңызды жоғары бағалаймыз

Мы высоко ценим Ваше предложение...

We are obliged for your Біз сіздің 19 мамырда ... letter of May 19, in which жайлы сұраған хатыңыз you enquire... үшін алғысымызды білдіреміз.

Мы признательны за Ваше письмо от 19 мая, в котором Вы спрашиваете...

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We should appreciate it very much if you could send us...

Егер сіз бізге ... жіберсе- Мы были бы очень призңіз, разы болар едік нательны, если бы Вы прислали нам...

We hope that our offer will interest you.

Біздің ұсынысымыз сіздерді қызықтырады деп сенеміз.

Надеемся, что наше предложение заинтересует Вас.

We are awaiting your instructions with interest.

Сіздің нұсқауларыңызды қызығушылықпен күтеміз.

С заинтересованностью ожидаем Ваших указаний.

Reminding of an Appendix

Қосымша жайлы ескерту

Упоминание о приложении

We enclose/are enclosing...

Біз қосымша береміз/ қосып отырмыз

Мы прилагаем...

We are attaching to this letter...

Осы хатқа қосымша беріп отырмыз

Мы прилагаем к этому письму...

Hope for an early reply

Жуық арада жауап алуға сенім арту / үміт білдіру

Выражение надежды на скорый ответ

We would greatly appreci- Біз сіздің жауабыңызға ate your answer. үлкен сенім артамыз.

Мы очень рассчитываем на Ваш ответ.

I am looking forward to hearing from you soon

Асыға жауап күтемін

Жду скорого ответа.

I look forward to hearing from you in due course

Сізден əдеттегідей жауап күтемін

Я рассчитываю на Ваш ответ обычным порядком

We will look forward to hearing from you (we should appreciate receiving your reply)at your earliest convenience,

Жауапты барынша тез қайтарады деп сенемін.

Я буду надеяться что Вы ответите при первой же возможности.

I would (we should) Жауапты шұғыл түрде Я буду (будем) очень greatly appreciate an early берсеңіз разы болар едім благодарен за скорый (prompt) reply. (срочный) ответ.

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I hope that I may hear Жақын арада жауап ала- Надеюсь на скорый (hoping to hear) from you мын деп үміттенемін / ответ, soon, сенемін. Binding elements of a letter

Хаттың байланыстырушы элементтері

Связующие элементы письма

We are sure (confident) that...

Біз толығымен сенімдіміз ...

Мы совершенно уверены, что...

At the same time we would like to remind you that...

Сонымен қатар, сіздің есіңізге ... салғымыз келеді

В тоже время, хотели бы напомнить Вам, что...

Apart from the above...

Жоғарыда көрсетілгеннен бөлек ...

Помимо вышеуказанного...

In view of the above...

Жоғарыда көрсетілгендей ...

Ввиду вышеизложенного...

Otherwise we shall have to...

Əйтпесе / кері жағдайда біз ... мəжбүр боламыз

В противном случае мы будем вынуждены...

We have (no) difficulty in...

Біз үшін ... қиындықтар жоқ

Мы (не) испытываем трудности в...

We have to admit that...

... мойындауға тура келеді

Необходимо признать, что...

In case of your refusal...

Сіз бас тартқан жағдайда ...

В случае Вашего отказа...

In case of your failure to make payment...

Ақысын төлей алмаған жағдайда ...

В случае неуплаты...

In this connection ...

Осыған байланысты ...

В связи с этим ...

Nevertheless ...

Дегенменде ...

Тем не менее ...

In fact ...

Іс жүзінде / Анығында

Фактически ...

First of all (In the first place ...)

Біріншіден / Ең алдымен... (Бірінші кезекте)

В первую очередь ...

Concluding phrases in letters

Хат соңында қолданы- Фразы в конце письма латын тіркестер

Best wishes,

Ізгі тілектер

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Наилучшие пожелания,

With best wishes,

Ізгі тілекпен,

С наилучшими пожеланиями, ...

With kind regards,

Ізгі ниетпен,

С дружеским приветом, ...

With best wishes and kind Ізгі тілекпен жəне досregards, тық ниетпен,

С наилучшими пожеланиями и дружеским приветом, ...

We take this opportunity of thanking you for your assistance.

Осы мүмкіндікті пайдаланып, Сізге жасаған көмегіңіз үшін алғыс білдіреміз

Пользуемся возможностью поблагодарить Вас за Вашу помощь.

With best regards,

Ізгі ниетпен,

С наилучшими пожеланиями, ...

137

CONTENTS PREFACE ...................................................................................................3 Unit I. Text 1. Text 2. Text 3. Text 4.

INTRODUCTION INTO ECONOMICS .................................4 Economics.....................................................................................4 Profession of an economist ...........................................................6 Economic systems.........................................................................8 International economy ..................................................................11

Unit II. HISTORY OF ECONOMIC THOUGHTS..............................14 Text 1. The first modern economists: the mercantilists and physiocrats ..................................................14 Text 2. World’s famous economists: adam smith and “The Wealth of Nations” ....................................16 Text 3. Classical champion of free trade: david ricardo (1772-1823) ......19 Text 4. Theorist who brought economics into the twentieth century: John Maynard Keynes (1883-1946) .............................................21 Text 5. Marxist methods of analysis .........................................................23 Unit ІІІ. Text 1. Text 2. Text 3. Text 4. Text 5. Text 6. Text 7. Text 8. Text 9. Text 10. Text 11. Text 12. Text 13. Text 14. Text 15.

MICROECONOMICS ...............................................................27 Microeconomics as a system ........................................................27 Founding a company.....................................................................29 Corporate development during the industrial revolution ..............32 Market ...........................................................................................35 The market place ...........................................................................37 Value, worth and utility ................................................................40 Price ..............................................................................................42 Marketing and sales ......................................................................45 Retailing ........................................................................................48 Supermarkets and other retail facilities ........................................50 Advertising and marketing............................................................53 Management..................................................................................55 What’s the difference between managers and leaders?.................58 Management styles and culture.....................................................61 Leadership styles...........................................................................63

Unit IV. Text 1. Text 2. Text 3.

MACROECONOMICS ..............................................................66 Macroeconomics as a branch of economics .................................66 Money ...........................................................................................68 Money as a medium of exchange .................................................70

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Text 4. Text 5. Text 6. Text 7. Text 8. Text 9. Text 10. Text 11. Text 12. Text 13. Text 14. Text 15. Text 16. Text 17. Text 18. Text 19. Text 20.

The functions of money ................................................................72 Monetary policy ............................................................................74 The Banking system .....................................................................77 Banker to the government .............................................................79 The Banque de France ..................................................................82 The World’s Stock Markets ..........................................................85 The Major Functions of the Stock Exchange................................88 Speculation in finance ...................................................................91 International trade .........................................................................93 Import and export .........................................................................96 Taxation ........................................................................................99 Types of taxes ...............................................................................100 Tax Evasion and Avoidance .........................................................104 Insurance .......................................................................................108 Lloyd’s Four Principal Classes of Business .................................111 Unemployment..............................................................................114 Inflation ........................................................................................116

APPENDIX .................................................................................................121

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Educational issue

Roza Eskhanovna Sarbayeva Mariyash Kaidaulovna Makisheva ENGLISH FOR ECONOMISTS Educational manual Second edition, revised

Typesetting: A. Aldasheva Сover design: K. Abdrakhmanov Cover design photos were used from the sites https://www.rbc.ru/economics/20/11/2013/5704133d9a794761c0ce3e36 IB № 13860 Signed for publishing 08.10.2020. Format 60×84 1/16. Offset paper. Digital printing. Volume 8,75 printer’s sheet. 60 copies. Order №12365. Publishing house “Kazakh University” Al-Farabi Kazakh National University KazNU 71 Al-Farabi, 050040, Almaty Printed in the printing office of the “Kazakh University” Рublishing house.