Translate into English using the expressions from the previous task.

UNIT 1

Sole proprietorship

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Before starting your business you have to choose the type of proprietorship in which you will own it. You should know that any business should be privately owned in three main forms. These forms are: the sole proprietorship, the partnership and the corporation.

The sole proprietorship. The sole proprietorship is the simplest organizational form. There is one owner who takes all profit after paying income taxes, and who is responsible for all business debts. He or she can make decisions without consulting anyone.

The strength of this form is in the direct personal interest of the proprietor in the efficiency of his business.

The great disadvantage of the sole proprietorship is that the proprietor is personally responsible for the debts of his firm and his liability is unlimited. Another disadvantage of this form is the strict limitation of its ability to acquire capital for expansion.

One-person business is widely used in farming, retailing, building, repair work and personal services such as hair dressing, beauty shops and the like.

Active vocabulary

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To choose – выбирать

proprietorship – собственность

to own – владеть

sole proprietorship – частная собственность

partnership – партнерство

corporation – корпорация

profit – прибыль

income tax – налог с доходов

debt – долг

strength – сила

proprietor – собственник

liability – ответственность

advantage – преимущество

disadvantage – недостаток

ability – способность

to acquire – приобретать

expansion – расширение

farming – фермерство

retailing – розничная торговля

repair work – ремонтные работы

Tasks

(перевести и выучить – 2 балла)

Translate into English using the expressions from the previous task.

Выбрать тип собственности

Организационная форма

Один владелец

Получать все прибыль

Оплата налогов с доходов

Отвечать за все долги

Принимать решения без консультации с кем-либо

Крупный недостаток

личный интерес собственника эффективность бизнеса

строгое ограничение

привлекать капитал для расширения

розничная торговля

ремонтные работы

Translate into English using the expressions from the previous tasks

(перевести письменно – 2 балла)

1 Я начинаю свое собственное дело и должен выбрать тип собственности.

2 Этот предприниматель владеет своим бизнесом в форме частной собственности.

3 Владелец компании платит все налоги с доходов.

4 Он также принимает все деловые решения и отвечает за все долги.

5 Предприниматель имеет прямой личный интерес в эффективности своего дела.

6 Владелец имеет неограниченную ответственность и может приобретать капитал для расширения.

7 Один собственник получает всю прибыль

8 Собственник принимает решение без консультации с кем-либо.

READING

(за перевод каждого текста в разделе READING – 1 балл, всего 12 текстов)

Forms of business ownership

Sole proprietorship: business that is owned, and usually managed by one person.

Example: most of the produce sellers at the central market.

Partnership: a business with two or more owners.

Example: some law firms, some accounting firms, etc.

General Partnership: has only General Partners (the General Partners are involved in the management of the firm but they have limited liability).

Limited Partnership: has Limited Partners (the Limited Partners have limited liability but they are not involved in the management of the firm) and at least one General Partner (the General Partners are involved in the management of the firm but they have unlimited liability).

Corporation: a business that is distinct legal entity (that is, that has an existence separate from its owners).

Closed Corporation: the stocks are held by a few people and are not available to the general public.

Example: M&M Mars Corporation.

Open Corporation: the stocks are sold to the general public.

Example: General Motors, Matsushita, Royal Dutch Shell.

Entrepreneur: one who starts a business, including its organization, management and risk-bearing.

Franchising: an arrangement for distributing goods or services that is agreed upon franchiser and franchisee.

Franchiser: the business that owns and sells others the right to distribute its goods and services.

Franchisee: the business that buys the right to distribute franchiser’s goods and services.

Example: many of Mc Donald’s stores, Hampton Inn (hotels).

Miscellaneous definitions

Acquisition: obtaining (in business it is when one company buys another).

Merger: combination of to or more firms to form one company.

Example: many banks in the USA are currently merging (such as Chemical and Chase Manhattan).

Subsidiary: subordinate or secondary (in business it is one company that is owned and controlled by another).

Example: Pizza Hut and Kentucky Fried Chicken are subsidiaries of PepsiCo.

Association: groups of people that are united for a purpose (in business it may be a professional association of educators, doctors, lawyers, accountants, etc).

Example: International Association of Translators and Interpreters, Institute of Managerial Accountants.

Cooperative: groups of people that are united for a principally economic purpose (it is basically a type of Association).

Example: agricultural cooperatives.

Joint Ventures: strategic alliance between two or more businesses.

Example: Fiat and Toillette car plant.

Non-profit Organization: an organization that does not profit for its owners.

Example: International Red Cross.

Miscellaneous abbreviations

Corp. (Corporation): a corporation.

Inc. (Incorporated): a corporation.

Ltd. (Limited): a corporation, it is used mainly in the UK and it gets its name from the fact that stockholders have only limited liability.

NGO (Non-government organization): usually used to describe Non-profit Organizations.

III

Steven Jobs and many other entrepreneurs have organized their companies as corporations. A corporation is one kind of business organization. Other kinds of business organizations are sole proprietorships and partnerships.

Sole proprietorship. A sole proprietorshipis a business owned by one person. Sole proprietorships are the most numerous kind of business organization, but most are very small. The reason for their popularity is that they are the easiest and least costly to organize.

There are other advantages. Sole proprietors own all profit of their enterprises, and they are their “own bosses,” free to make whatever changes they please. They have minimal legal restrictions and do not have to pay the special taxes placed on corporations. Sole proprietors also have the opportunity to achieve success and recognition through their individual efforts.

There are also disadvantages. A very serious one is unlimited liability that each proprietor faces. All debts and all problems associated with the business belong to the owner. If a business fails, the owner must personally assume the debts. This could mean the loss of personal property such as automobiles, homes and savings. A second disadvantage of the sole proprietorship is that it has limited capital. The money that a proprietor can raise is limited by the amount of his or her savings and ability to borrow. Also when the owner dies, the business dies. Other disadvantages may include lack of opportunities for employees, limitations of size and growth lack of management resources.

UNIT 2

Partnership

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The partnership. Partnerships are voluntary combinations of from two to twenty persons formed for the purpose of carrying on business with a view of profit. Partners share responsibilities for decision making, profit and debts. They usually get tax benefits from the government. There are two types of partnerships: with limited and unlimited liability. It depends on the fact if partners are responsible for all business and for all debts or not.

Partners usually specialize in one or more aspects of the business: one may be responsible for buying, one for selling, one for production and so on.

The disadvantage of partnership is that partners may disagree with each other. Where trading risks are great partnership is not a very stable type of organization.

Partnership is a common form of business organization in such professions as law, accountancy, medicine, insurance, stockbrokerage and real estate.

Active vocabulary

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Purpose – цель

to share – делить

to carry on – вести

tax benefits – налоговые льготы

limited liability – ограниченная ответственность

unlimited liability – неограниченная ответственность

to depend on – зависеть от

trading risks – торговые риски

law – юриспруденция

insurance – страхование

stockbrokerage – биржевое маклерство

real estate – недвижимость

retailing – розничная торговля

READING

Partnership. A partnershipis a business organization that is owned by two or more persons. Partnerships offer certain advantages over sole proprietorships:

Partners bring additional funds to proprietorship.

Partners can bring fresh ideas and talents to business organizations.

Like the sole proprietorship, partnerships are relatively easy to form and are not subject to special taxation.

Partnerships have the following disadvantages:

In many cases, each of the partners is subject to unlimited liability. Partners are individually responsible for all the debts of the business. In other words, if the business were to fail, its creditors (those to whom money is owed) would have the right to recover their money from any, or all, of the partners.

Such was the case with Harold Nodough, Gloria Poor and Jack Rich who owned the Trio Dress Shoppe as a partnership. Under the terms of their partnership agreement, Nodough and Poor were each entitled to 40 % of their profits, while the remaining 20% went to Rich. Last month the firm collapsed. After selling off everything is owned, the company still owed its creditors $10000. since Nodough and Poor had no assets of their own, the creditors recovered the total amount from Rich’s personal bank account. Partnership agreements, however, can be designed to limit the liability of each partner so that investors like poor Mr. Rich can be protected.

Any time a partner dies or with draws from the business, the partnership is legally terminated. If the business is to continue, a new partnership agreement must be drawn up.

The amount of capital that a partnership can raise is limited. Exactly what this limit is will depend on the earnings of the business, the wealth of the partners, and their liability to borrow.

Partners may disagree, causing management conflicts that could threaten the firm’s existence.

The Price System.One of the remarkable things about the American economic system is that it seems to run by itself. No central economic agency dictates responses to What, How and Who questions. Yet the questions are answered.

Prices determine what we are willing and able to buy. They influence us to continue in school or to accept a job. Prices help to determine what and where factories will be built, which businesses will succeed, which will fail, and even the color and style of the clothing that will be manufactured.

Prices, the money value of goods and services, carry so much information and so affect the behavior of buyers and sellers that economists often describe our economy as a price-directed system.

The price system provides the answers to the fundamental questions of What goods and services will be produces, How they will be produced, and Who will receive them.

How the price system answers the What question.When buyers want more of a product, they are willing to pay more for it. Higher prices attract other producers. As production increases, the need for additional workers causes wages to rise within the industry. When demand for the product fails, the opposite happens. Prices fall, producers who can no longer operate profitably shut down, or switch to other products, and production falls enough to meet the reduced demand.

How the price system answers the How question.The price system encourages sellers to produce in such a way as to costs and maximize profits.

Stanly Lee owns a newspaper delivery service. Stanly used to rely on 10 to 15 kids with bicycles to deliver the newspapers before and after school. One day Stanley calculated that it would cost less to use one adult with an automobile than 15 kids on bicycles to deliver his newspapers. He laid off the school kids and hired the adult.

How the price system answers the Who question.Those who graduate from high school earn more, on the average, than those who drop out. Many professional athletes earn more than letter carriers. Physicians and attorneys earn more, on the average, than stenographers and building superintendents.

Since they earn more, professional athletes, physicians and attorneys can afford to buy more goods and services than people earning less than they do. Thus, by assigning values to the work people do, the price system answers the Who question.

III

Competitionrefers to the rivalry among buyers and among sellers. Sellers compete by trying to produce the goods and services buyers want at the lowest possible price. Those unable or unwilling to sell at a price low enough to attract buyers will be unable to dispose of their goods and services. This rivalry benefits us all.

It benefits us by giving us the goods and services we want, when and where we want them. Producers know that if they don’t satisfy consumer demand, their competitors will.

It benefits us because producers must constantly strive to operate more efficiently. The quest of greater efficiency conserns scarce resources, increases output and raises living standards by reducing costs.

Buyers compete with one another because there is never around everything to go around. Those willing to pay the price can buy a steak. Those unwilling or unable to pay will substitute a less costly product like chopped meat, chicken or hot dogs. In other words, in the rivalry among buyers of steak, those unable to pay the price will lose to those who are able to pay.

If we think of private property, the price system and competition as providing the foundation of our free enterprise economic system, then profits and other economic incentives supply the cement that holds the structure together.

The role of economic incentives.Economic incentives influence our decisions about what and where to buy.

The desire to achievethe greatest profit for our efforts is the principal economic incentive in the American and other market economies. Economists refer to this as economic self-interest.

Of course economic self-interest cannot explain human behavior. Workers may pass up the chance to earn more simply because they don’t want to move to another region. Business firms often reduce their profit by contributing to charitable or other public service organizations. Many parents forgo job opportunities to raise their children at home. And for many reasons other than price, consumers may prefer to shop at one store rather than another.

UNIT 3

Corporation

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The corporation. A business corporation is an institution formed by two or more shareholders, who put money into business and get a share of profit. Their share of ownership is represented by stock certificates. This form of ownership allows attracting financial resources, investing a large amount of capital into production, equipment and research, offering high salaries and attracting talented managers and specialists. Except privately owned corporations there are some other types two, such as educational, religious, charitable and governmental ones. Usually they don’t issue stock certificates and are non-profit.

Also a business may be owned in the form of franchising and other miscellaneous forms.

Active vocabulary

(выучить – 1 балл)

Institution – учреждение

share – доля

ownership – собственность

stockholder (shareholder) – акционер

stock certificate – акция

to attract – привлекать

to offer – предлагать

charitable – благотворительный

to issue stocks – выпускать акции

to share – делить

non-profit – неприбыльный

franchising – франчайзинг

miscellaneous – смешанный

READING

Corporation.A corporationis a business organization created under a government charter. Ownership of corporation is represented by shares of stock, and for that reason corporate owners are known as stockholders.

One feature of corporation is that the courts treat it as a legal “person”. It can, for example, sue and be sued and enter into contracts, and it must pay taxes.

Although corporations are outnumbered by about four to one by sole proprietorships, they dominate American business. Corporations are so important because of the advantages they offer over sole proprietorships and partnerships:

Limited liability. Unlike the owners of proprietorships and partnerships, who can be held personally liable for the debts of their firms, the most that corporate shareholders can loose (i.e., their liability) is limited to whatever they paid for their shares of stock. Limited liability is thought to be so important that corporations in most English-speaking countries outside of the United States add the abbreviation “Ltd” (for Limited) to their company name.

Ease of transfer. Stockholders can enter or leave a corporation at will simply by buying or selling shares of stock in that corporation.

Unlimited life. When the corporate stockholders die, their shares of stock are passed on to their heirs. Meanwhile, the corporation is free to conduct business as usual.

Tax advantages. In certain instances individuals can reduce their tax liability by incorporating.

With all these advantages you might wonder why there are so many more unincorporated businesses than incorporated ones. The answer has to do with the disadvantages of the corporation:

It is difficult and expensive to organize a corporation. The process of obtaining a charter usually requires the services of a lawyer. Most small firms prefer to avoid these expenses by forming proprietorships or partnerships.

Corporations are subject to special taxes. The federal government, along with many state and local governments, taxes corporate income in addition to the taxes paid by shareholders on their dividends. (Dividends are the proportion of a corporation’s profits that are distributed to the stockholders.)

Corporations whose stock shares are sold to the public give up their right to privacy. The law requires that these large, open(or public) corporations disclose information about their finances and operations to anyone interested reading about them. The purpose of this legislation is to give people information about companies in which they might invest. But information that helps investors may also be of value to the competition. For that reason, some corporations have chosen to remain closed (or private) corporations rather than disclose information they would prefer to keep secret.

III

Cooperatives. Cooperatives(or co-ops) are associations of individuals or companies organized to perform business functions for their members. You may already be familiar with:

Housing co-ops, multiple dwelling units owned by their tenants.

Consumer co-ops, retail businesses owned by members who share in the profit and/or purchase goods or services at lower cost.

Producer co-ops, companies that manufacture and market products on behalf of their members. One of the largest of these is Ocean Spray Cranberries, Inc. this cooperative of neatly a thousand cranberry and citrus growers from around the country has annual sales of neatly $500 million.

Franchises. A franchise is a license to operate an individually owned business as if it were part of a large chain. Many clothing, real estate, fast food and motel chains are franchise operations.

Franchises provide advantages. Since the money to pay for a new franchise is provided by the franchisee (those who purchase the franchise), franchisors (corporations that sell their franchises to others) are able to expand their operations at little cost to themselves. Franchisors also benefit because franchisees are owners rather than employees of the business. This provides the kind of incentive that can lead to increased sales and profits.

Those who buy franchises also benefit. Many firms provide training programs, financial assistance and other kinds of help in operating and managing the business. Franchisees also benefit from the sales and name recognition generated by the company’s advertising campaign and reputation.

Franchises do have some disadvantages. Franchisors retain a great deal of control over their franchisees. They may dictate how the business is to be operated, the building decorated, even types of uniforms and signs. In addition, many franchisors require that the products must be purchased from the parent company at whatever price it chooses.

UNIT 3

Active Vocabulary

(выучить – 1 балл)

оwn - собственный

to earn – зарабатывать

experience – опыт

skill – навык

to choose – выбирать

success – успех

to manufacture – производить

to wholesale – продавать оптом

to retail – продавать в розницу

to provide – обеспечивать

to develop – развивать

failure – неудача

to estimate – оценивать

costs – расходы, издержки

to run the business – управлять бизнесом

material costs – материальные издержки

labour costs – трудовые расходы

overheads – накладные расходы

salary – заработная плата

to expand a business – расширить дело

to borrow from – занимать у

loan – займ

to attract – привлекать

to depend on – зависеть от

promotional campaign – компания по продвижению товара на рынок

convenient location – удобное месторасположение

reasonable price – разумная цена

society –общество, объединение

to advertise – рекламировать

ability – способность

to allow

Tasks

READING

A young entrepreneur

Jayson Meyer was sixteen when he and his younger brother Matthew started their technology company. Jayson lives in Daytona Beach, Florida, in the USA. He looks like any typical university student, buy Jayson doesn’t go to university. He doesn’t need to. He is already a successful businessman. Jayson is a co0founder and CEO (Chief Executive Officer) of Meyer Technologies, Inc.

At high school Jayson spent a lot of time working on computers for the school and local businesses. He didn’t have time for school work, but he could fix almost any computer problem. So when he was fifteen Jayson left school and went into business full time. With his brother he set up a shop at the local weekend market.

The business was successful and quickly went from making $ 4000 in the first year to $ 100000 per year. Soon Meyer Technologies, Inc expanded and was making over $ 500000. The company builds special computers and creates software programs for its clients. Many small businesses in Florida can’t afford in-house computer support. They rely on service companies like Meyer Technologies to maintain their computers, and the company has plenty of customers. In 2000 the sales grew to over $1 million. Not bad for a business whose CEO was not old enough to vote!

Currently Jayson is helping to grow another company called Work Smart MD, which makes special software for doctors’ offices. Jayson now employs a number of technical staff and most of them are older than their boss. Jayson himself works 80 to 100 hours a week and often sleeps at the office. He doesn’t have a lot of free time to do the things that most young people do, but he doesn’t mind. He says, ‘I’d rather be building an international business. I think about my business most of the time – it’s in my blood’.

Getting started in business

What do Juan from Spain and Jessica from the USA have in common? They are both teenagers running successful businesses. Juan, 16, has a gardening business with 75 clients and three employees. Jessica’s company cleans new houses. She started it when she was 14. if you want to start a business, good planning is important. Here are some tips.

1 Get organized. Decide what your skills are. Find out if there is a market for them in your area, e.g. ask your neighbours what they need. Babysitting, coaching for exams or sports and computer training are all possibilities.

2 Decide how much money you need to start your business. Think about how to get the capital. You can use your own money or you can ask the bank for a loan.If you get a loan, be sure you can afford to pay theinterest.

3 Calculate your costs.First, work out your fixed costs, for example, the rent on your office or the interest on a loan. Then add your variable costs, for example, equipment or tax (if you pay).

4 Work out how much to charge for your service. Find out what other people are charging and use this to set your own prices.

5 Your revenueis the amount of money you receive from selling your service. You need to calculate this very carefully. Your revenue is the number of hours worked multiplied by the price per hour.

6 Your business will make a profitif your revenue for a year is more than your costs. If your costs are higher than the revenue, you’ll make a loss. Work out carefully the number of hours you need to work.

III

Geeks

Although they live hundreds miles apart, Steven Jobs and William Gates have much in common. Both were born in 1956. Both were pioneers in the personal computer industry. And both became multi-millionaires when they were still in their 20’s.

The earliest computers were highly technical machines, understandable only to scientists. Steven Jobs thought that if computers were easier to use and less expensive, the public would buy them. He was right. With $ 1300 (most of which came from the sale of his second-hand Volkswagen van), Jobs produced what he called the Apple I computer. The success of the Apple I gave him the money to finance the design of new and improved personal computers.

Bill Gates started in the computer industry when he was at school and has become the world’s youngest billionaire by the age of 31. A combination of technical brilliance and competitive business tactics quickly made him the most powerful man in Silicon Valley. He was intrigued by the success of the new personal computers coming into the market in the 1970’s. Gates realized that the success of personal computers would depend on the “user-friendly” (easy-to-use) software. In 1975 he co-founded Microsoft Corporation which designed the basic operating software for all IBM and IBM-compatible personal computers.

Today Microsoft Corporation is the largest software company. But Bill Gates wants his company Microsoft to be more than just a software house and in recent years it has diversified into many new fields.

Всего 60 баллов за семестр

UNIT 1

Sole proprietorship

(рассказать наизусть – 4 балла)

The strength of this form is in the direct personal interest of the proprietor in the efficiency of his business.

One-person business is widely used in farming, retailing, building, repair work and personal services such as hair dressing, beauty shops and the like.

Active vocabulary

(выучить – 1 балл)

To choose – выбирать

proprietorship – собственность

to own – владеть

sole proprietorship – частная собственность

partnership – партнерство

corporation – корпорация

profit – прибыль

income tax – налог с доходов

debt – долг

strength – сила