Pre-reading Activities. 1. Use key vocabulary to complete the sentences

1. Use key vocabulary to complete the sentences.

1. Macroeconomics studies the total output of a nation and the way the nation allocates its limited … of land, labor and capital.

a) resources b) oil c) activity

2. A customer's … are usually safety, quality, and value.

a) deposits b) resources c) demands

3. If you … ownership of your business with someone else, your business will not be a sole proprietorship.

a) assist b) share c) create

4. Inform me where the conference will … .

a) undertake action b) carry out c) take place

5. Management skills can be a separate factor of production called … .

a) inputs b) entrepreneurship c) risk-bearing

6. My secretary … in making the decision.

a) assisted b) shared c) carried out

Reading

Read the text and find out what factors of production are.

Economists have long recognized the three major factors that people use to create the things they want. Land, labor, and capital are "factors of production”, or “inputs”. Each factor plays an important role in the production of goods, and each factor is clearly distinguishable from the other two.

Land includes not only the site of production but natural resources above or below the soil. These are agricultural land, mineral deposits, forest, rivers, lakes, oil deposits, mountains, etc. Land is a passive factor in production. To make the gifts of nature satisfy our needs and desires, human beings must do something with natural resources. This activity is called labour.

Thus, labour is human effort – physical and mental – which is directed to the production of goods and services. But labour is not only a factor of production, it is also the reason why economic activity takes place. The people who take part in production are also consumers, the sum of whose individual demands provides a business person with the incentive to undertake action.

Capital is a man-made resource. Any product of labour and land which is reserved for use in the further production is capital.

Capital was created when people began to make simple tools to assist them in the production of food, the hunting of animals, and in the transportation of their possessions.

Entrepreneurship is also sometimes considered a factor of production. Land, labour, and capital will not produce anything. There must be some person or persons who will organize these three factors so that production takes place. Someone must take the decisions what, how, and where to produce. Whoever takes the decisions and the risks is known as an entrepreneur.

Organisation, management and risk-bearing – these are the entrepreneurial functions. In a one-person business, they are all carried out by the sole-proprietor. In a large company, the functions are shared.

Remember!

Comprehension Check

1. Use the best alternative to complete the statements.

1. The term "factors of production” means the same as …

a) natural resources;

b) inputs;

c) production of goods and services.

2. Land is … a) human effort;

b) man-made resource;

c) a passive factor.

3. Capital is … a) the reason why economic activity takes place;

b) any product of labour and land;

c) directed to the production of goods and services.

4. Entrepreneurship is …a) a one-person business;

b) organization and management;

c) the practice of starting a new business.

2. Are these statements True or False? Correct the false ones.

1. There are three factors of production.

2. Land is a man-made resource.

3. Labour can be both physical and mental.

4. Labour is a passive factor in production.

5. The entrepreneur must take the decisions what, how, and where to produce.

3. Answer the questions.

1. What are “inputs”?

2. Does land include only the site of production?

3. Why is land considered a passive factor of production?

4. Is labour only a factor of production?

5. How do capital and labor differ from land?

6. Who takes decisions and risks in the process of production?

7. What are the entrepreneurial functions?

Vocabulary Focus

1. With the help of the text, translate into English the following words and phrases.

создавать что-либо

играть важную роль

чётко отличаться от чего-л.

над или под землёй

сельскохозяйственное угодье

удовлетворять потребности и желания

принимать участие в производстве

созданный руками человека

простейшие орудия труда

принимать решения.

2. Find in the text synonyms to the words below.

- to make

- to help

- to take action

- natural reserves

3. Fill in the gaps with prepositions, if necessary.

1. My colleagues are carrying … research on business ethics.

a) out

b) on

c) away

2. We shared … the money equally.

a) out

b) between

c) -

3. The meeting takes place … the hall every Friday.

a) at

b) in

c) on

4. The President was assisted … his advisers.

a) with

b) by

c) -

5. I sometimes have difficulty distinguishing Spanish … Portuguese.

a) between

b) from

c) with

Talking Points

1. Explain why the factors of production are interdependent.

2. Consider the four factors of production that went into the making of any book. Label each item: LD for land, LR for labor, C for capital, or E for entrepreneurship.

1. trees _____

2. computers _____

3. publishing executive _____

4. salesperson _____

5. editor _____

6. petroleum _____

7. oil used for fertilizer _____

8. book presses _____

9. word processing specialist _____

10. typesetter _____

11. storage shelves _____

12. publisher’s building site _____

2. “An Entrepreneur”, according to the American Heritage Dictionary, is “someone who organizes, operates, and assumes risk for business ventures.” In your opinion, what some common traits of character do successful entrepreneurs share?

3. Is it possible to improve the efficiency of the factors of production? If yes, in what way?

Summary Points

1. Read the text about factors of production once again. What is its main idea?

2. Divide the text into logically complete parts. Take notes on the most important information each paragraph contains. Report it to the whole group.

UNIT 10

FORMS OF BUSINESS

Lead-in

1. Many people dream of having their own business. To see if starting a business is right for you, you have to ask yourself some very important questions. Your answers will help you determine if you are ready to become a small business owner, what kind of business you want, what your target audience is, who your competitors are, etc. Working with a partner, make a list of these questions.

2. Would you like to start your own business? What kind of business would it be? What would your main business goal be?

3. What are the dangers of having your own business?

Key Vocabulary

Make sure you know the following words and word-combinations.

1. ownership n	собственность, право собственности
2. vary v	меняться, варьироваться
3. partnership n	товарищество
4. joint stock company	акционерное общество
5. cooperative society	кооператив
6. public corporation	государственная корпорация
7. enterprise n	предприятие; предприимчивость, инициатива
8. assume risks	принимать на себя риск
9. be responsible for	быть ответственным за
10. disadvantage n	недостаток
11. liability n	ответственность
12. carry on n	вести (дело)
13. personal possessions	личное имущество
14. contribute v	сотрудничать, делать вклад
15. stockholder n	акционер
16. mutual benefit	взаимная выгода
17. flow in	поступать (о деньгах)
18. tax n	налог