1. Understanding Expressions: give the best explanation for each of these phrases used in the text.

To observe economic behaviour; to satisfy economic wants; to exceed the available resources; natural resources; to anticipate the wants of consumers; input and output; raw materials.

2. According to the text, mark these statements t (true) or f (false):

1. Microeconomics is the study of the behaviour of the economy as a whole while macroeconomics studies the effect of widespread unemployment on the whole nation.

2. Scarcity exists when there are not enough resources to meet human wants.

3. Factors of production can be divided into four broad categories: land, labour, service, and entrepreneurship.

4. Buried deposits of minerals, gas, and oil do not belong in the category of land.

5. Labour is a measure of the work done by human beings.

6. Offices, warehouses, stores, roads and airplanes are all forms of capital.

7. Businesses invest in real capital while workers invest in human capital.

8. Variable factors of production are sometimes called supplementary factors.

3. Give the best definition for the following economic terms.

Fixed factors of production; human capital; natural resources; scarcity; wants and needs; productive capacity; aggregate demand and aggregate supply; to meet human wants; real capital; capital goods.

4. Choose the variant that best explains the idea of the sentence below.

Economists view economic information through the most useful lens.

1. Economists study economic data.

2. Economists observe economic behaviour through microeconomics and macroeconomics.

3. Economists aim to study economic behaviour of agents, firms and individuals.

5. Give profound answers to the following questions:

1. What is microeconomics? What is macroeconomics?

2. What is the difference between needs and wants? Explain how a need may also be a want.

3. What is scarcity and why does it exist? What is a shortage?

4. How does scarcity affect consumers? Producers?

5. Why are people affected by scarcity regardless of their income?

6. What helps economists identify the factors of production?

7. What are the factors of production? What categories are they divided into?

8. What is the difference between fixed and variable factors?

9. Why are fixed factors supplementary in nature?

10. How do nations get wealthier even when available land diminishes over time? Consider the factors of production in your answer.

6. Practise reading §5 of the text. Translate it into Russian. Give a short summary of the passage.

C. How the text is organised

1. What do these words refer to in the text?

1) it (§ 1); 2) them (§ 5); 3) it (§ 6); 4) it (§ 7); 5) that (§ 13).

2. Find the paragraphs of the text dealing with the following concepts.

1) the difference between capital goods and consumer goods; 2) divisible and indivisible factors of production; 3) relationship between needs and wants; 4) the fourth factor of production; 5) the starting point of all production; 6) economic resources needed to produce goods and services; 7) the basic economic questions; 8) the study of the behaviour of individual players in an economy and the economy as a whole; 9) supplementary and prime factors of production.