Una! Exam

Text 2 what is gnp?

In every country the production of goods and services provides the food, clothing, and shelter that allow its people to survjve and prosper.

Sonic countries produce an abundance of raw materials such as coal and oil while Others produce manufactured goods like steel and lorries. Some countries may concentrate on producing foodstuffs like butter while others produce services - insurance, or banking. Whatever is not consumed in the country itself can be sold to other countries as exports.

The si/c of a country's economy is determined by the total amount of goods and services that country produces. As more goods and services are produced, the economy grows - and the best way to measure this growth is to put a monetary value on everything bought or soUL Although money is no! the only measure of an economy^ size, it is the easiest way to sum up the value of all the apples jnd oranges, automobiles and computers, football games and college classes that a country produces in the course of a given year.

The monetary value of all these goods and services can then be added up and compared with that of other countries. The measure of economic activity that includes all the goods and services bought or sold m a country over the course of a year is called gross domestic product (GDP).

Text 6

CENTRAL BANK'S ACTIVITY

The way of controlling the money supply is to raise or lower interest rates. When a central bank decides that the economy is growing too slowly - or not growing at all - it can reduce the interest rate it charges on the loans to the country's banks. When banks arc allowed to get cheaper money at the central bank, they can make cheapcr loans to businesses and consumer, providing an important stimulus to economic growth. Alternatively, if the economy shows signs of growing too quickly, a central bank can increase the interest rate on its loans to banks, putting the brakes on economic growth.

Perhaps the most dramatic way of increasing or decreasing the money supply is through open market operations, where a ccntral bank buys or sells large amounts Of securities, such as government treasury bonds', in the open market. By buying a large block of bond*. from a bank tor example, the central bank pumps money into the economy because it uscv funds that previously were not part of the money supply. The money used to buy the bonds then becomes available for banks to lend out to consumers and businesses

In a sense, the ccntral bank creates money every time it dips into its vaults to buy bonds in the open market.

treasury bonds - долгосрочные казначейские обязательна (облигации)

Final Exam

Text 4

WHAT IS A CENTRAL BANK?

Just a prudent driver keeps an eye on the road and a hand on the wheel, every country's ccntral bank watches economic data carefully and adjusts the money supply in an effort to keep the economy headed in the right direction.

Instead of taking deposits and making loans as normal banks do. a ccntral bank - such as the U.S. Federal Reserve - controls the economy by increasing or decreasing the country's supply of money. Printing process is not the only way for a central bank to increase the economy's supply of money. In fact, in most modern economics printed notes are only small percentages - often less than 10 ^r' of the money supply. Central banks usually print only enough currency to satisfy the everyday needs of businesses and consumers. The U.S. Federal Reserve, for example, has the Bureau of Printing and Engraving that prints up bills from time to time simply to replace worn-out money in the economy at large.

Since most "money" is actually nothing more than a savin» or checking account at a local bank, the most effective way for a central bank to control the economy is to increase or decrease bank lending and bank deposits. When banks have money to lend to their customers, the economy grows. When the banks arc forced to cut back lending, the economy slows.

MACROECONOMICS AND MICROECONOMICS

Economics is the study of the way in which mankind organizes itself to solve the basic problem of scarcity. All societies have more wants than resources, so that a system must be devised to allocate these resources between competing ends. In a very real sense, the complexity of the economy makes it difficult to decide exactly where to Mart. Simultaneously, production is taking pJacc, goods and services arc l>cing allocated, and a great number of market participants are being motivated by a diverse set of goals.

Economics is divided into two major branches: macroeconomics and microeconomics. Macroeconomics is the stud> of l*ha\ior of the economy as a uiiolc with emphasis on the fcKlors tliat determine growth and fluctuations in output, employment, and the level of prim. Macroeconomics studies broad economic events that arc largely, bc)ond the control of individual decision makers and yet affect nearly all firmv. households, and other institutions in the economy. Specialists in nucrocconomics are particularly interested in understanding those factors tfut determine inflation, unemployment, ami growth in \h: production of goods .:nd services.

1Ъе other major branch of economics is microccononuov. Microeconomics is the study of behavior of individual units within tin- economy. The division of economics has resulted from the gross ing complexity and sophistication of coonomic research.