Lesson 6

1. Read and translate the text:

Money and Finance

A.

As we progress in adult life and take on more responsibilities there are some things we have to learn about money - getting it to work for us and our families and taking care of our future needs.

Money has various uses in the modern world: it is a measure of the value of goods and services, a means of exchanging such goods and services and a way to store up purchasing (buying) power so that one can use it later.

As a measure of value, it is of the very greatest use. If I work in an office, how can my employer know what to pay me for my services if there is no generally recognized measure of value? He may decide to pay me a certain number of loaves of bread each week, but then I shall have to exchange some of these loaves for other things I need: and how am I to know how many loaves of bread I should give for a pair of shoes or for the rent of my house, for example? Money gives us a very useful means of measuring such relative values.

Money is also of very great use as a means of exchanging goods and services. If, for example, I am a shoe-maker, it will not be at all convenient to me always to have to exchange the shoes I make for other goods and services. A doctor may want to buy a pair of shoes from me, but I may not need medical care, so then he will have to find something else that I want, or look for another shoe-maker who needs him. Without money the tax-collector would come back to his office with an extraordinary collection of things.

Considered as a means of storing up purchasing power, money has good and bad points. It can more easily be kept a long time than such things as food, which rots, or buildings, which slowly fall to pieces, or machines, which rust. It takes up very little space, and if you put it in a bank, it is safe and can earn you interest.

But modern money has some very serious disadvantages as means of storing up purchasing power. In the old days, when money was in the form of gold and silver coins, the metal in each was really worth the amount stamped on the coin. But the paper in modern paper money and even the metal in most modern coins are no longer worth the amount written on them. As a result, the buying power of modern money can change very greatly in a short time.

It is not surprising, therefore, that some people are doubtful about the wisdom of saving money.

(Hill L.A., Fielden R.D. Further Comprehension for Overseas Students)

B.

Once you have left school you are likely to have some form of regular income, that is your earnings. So you have to find the best way to get a true feel for finance.

Most of us will need professional help at some time or other if we are to manage our money in the most effective way. It is important that you plan and budget your income to ensure that you are able to pay regularly for your day-to­day living - food, rent, gas, electricity, etc. You should get used to budgeting -to working out what you will be spending on bus or train fares and meals, and to see how much cash will be left over for spending on your hobby or for going to the cinema or the disco. You must be sure that without a carefully calculated financial plan and budget either your household or your company has little chance for success.

Out of that fixed income you will have to:

• pay everyday expenses;

• pay the regular household bills;

• set money aside for emergency spending;

• try to save.

Then there will be transport costs each day. You will be paying for your own meals, and buying your own clothes. Any hobbies or sports interests you have will mean more spending.

Even if you live at home, your parents will probably expected you to pay something towards your board and lodging. You will most likely want to go out some evenings with friends - it will mean spending on entertainment. And finally there will always be something unexpected which you suddenly have to find the money for.

There is quite a lot of spending to keep track of. Here is a 'sample' of budget which you can use as a basis for your own personal weekly or monthly budget.

Commentary:

to take on responsibility – брати на себе відповідальність

getting it to work for us – змусити працювати їх (гроші) на нас

purchasing power – купівельна спроможність (syn. buying power)

not at all convenient –зовсім незручно

tax-collector – збирач податків

to be worth doing smth – бути вартим, заслуговувати

income (syn. earnings, revenue, profit) – дохід, прибуток

spending – витрати (syn. expenditure, expenses, costs)

to get a true feel for finance – мати уяву про фінанси

to keep track of spending – вести облік витрат

2. What have you learnt from the text about:

1. the main uses of money;

2. modern money and its disadvantages;

3. the necessity to save money;

4. the necessity to budget one’s income;

5. the necessity to keep track of spending;

6. the necessity to get a true feel for finance.

3. Change the words underlined by the words from the text:

The buying power of the dollar is falling. One dollar is worth one hundred cents. The Ukrainian Government has announced further cuts in public expenditure. After the Chornobyl accident in Ukraine people in many countries raised the funds to help our country.

4. Remember the meaning of the following words:

VALUE: worth, marketable price, estimation (цінність);

COST: price to be paid for a thing (вартість);

PRICE: money for which a thing is bought or sold (ціна);

WAGES: payment made or received at regular intervals for manual or mechanical work or services (зарплата);

SALARY: fixed monthly or quarterly payment for regular employment on a yearly basis (посадовий оклад);

FEE: charge or payment for professional advice or services (гонорар).

5. Fill in the gaps with the words value, cost, price:

He learnt the … of a friend. The oil … are falling in the world market. The OPEC countries have agreed to reduce oil production to keep the … on the same level. Synthetic materials have become cheaper, since the … of production are lower now. The … of living has risen, whereas wages have remained the same. The … of this information is enormous. He set a high … on his time. At Christmas sales one can buy goods at reduced … .

6. Answer the questions:

• What do you do with money more often? Regularly? Never?

• What would you like to do with money if you had more than the barest minimum? (прожитковий мінімум) Much of it?

• What is the wisest way to deal with money?

• Could you mention some of the world’s currencies?

• What is the interest rate in the savings banks of Ukraine? In other countries?

7. Read, translate and retell the texts.