The market economy

Robert Frost

Read the article without a dictionary, try to retell it.

At leisure

Word origin SYMPOSIUM: THEY DRANK TOGETHER

This interesting word is based on the Greek term SYMPOSION, from SYM, «together», and PINO, «drink». The Greeks of old held their SYMPOSIUMS after dinner, when they would drink wine together and mix enter tainment with intellectual con versation. The dialogues of the Greek philosopher Plato, which he called the SYMPOSIUM, is an imagined conversation at such a gathering. And so with us a SYMPOSIUM has come to mean a collection of comments, opin ions,

and short essays — especial ly several articles on the same subject by different writers — as in a pamphlet or magazine.

2. Translate the proverbs, think of Russian equivalents, give a
situation using them.

— Can the leopard change his spots?

— Barking dogs seldom bite.

3. The poem to enjoy. Try to learn it by heart.

October

Oh, hushed October morning mild, Thy leaves have ripened to the fall, Tomorrow’s wind if it be wild Should waste them all.

The crows above the forest call. Tomorrow they may form and go. Oh, hushed October morning mild Begins the hours of this day slow.

Unit 4

Pre-text exercises

1. Find the transcription of new words in a dictionary, try to read
them fluently.

government, influence, characteristic, supply, compete, afford, raw, theoretical, nevertheless, incentive.

2. Word-building
Compile and translate:
own υ. + -er →
compete υ. + -tion →
produce υ. + -er →

The market economy is sometimes called the free market. A free market is not controlled in any way by a government. It is also free from the influence of custom or tradition. In a free market, the only reason

why things are bought and sold is because there is a demand for them. Prices for goods and services are simply what people are prepared to pay. The market economy is not really controlled by anyone. It controls itself.

The street market has many of the characteristics of the free market. Customers arrive at the market with a shopping list of things they need. They also come with an idea of how much they are prepared to pay. Stall owners sell what customers demand, and try to get the highest price they can for it. Supply and demand control what is on the market and how much it sells for. In the wider economy, we are all customers, and the stall owners are like companies.

The role of the company in the free market is to supply what people want. However, companies need an incentive. The incentive is profit. There are two ways for companies to make a profit. The first way is to raise their prices. The second way is to reduce their production costs. And this brings us to two more features of the market economy: competition and technology.

Competition exists in a free market because, theoretically, anyone can be a producer. This means that companies have to compete with each other for a share of the market. Competition is good for consumers because it helps to control prices and quality. If customers aren’t happy with a product or service, or if they can’t afford it, they will go to a competitor.

Technology exists in a free market because producers need ways to reduce their costs. They cannot buy cheaper raw materials. Instead, they must make better use of time and labour. Technology is the use of tools and machines to do jobs in a better way. This helps companies produce more goods in less time and with less effort. The result: more profit.

People often think that most economies are free markets. However, at the macroeconomic level, a truly free market economy does not exist anywhere in the world. This is because all governments set limits in order to control the economy. Some governments set many limits, other governments set very few, but they all set some. For this reason, a true market economy is only theoretical. Nevertheless, many of the features of the market economy do exist in most societies today.

Words:

market — рынок profit — прибыль

in order to — для того, чтобы share — доля

goods — товары price — цена

stall owner — владелец торгового to reduce — уменьшать

места на рынке labour — труд

to advertise — рекламировать limit — ограничение

competition — конкуренция nevertheless — тем не менее

incentive — стимул job — работа

Post-text exercises

Working on the text

I. Find the answers in the text:

I. Is a free market controlled by a government? 2. Can customs or traditions influence a free market? 3. Why are things bought and sold in a free market? 4. We all of us are customers, aren’t we? 5. What is the role of the company in the free market? 6. Why do companies need an incentive in the free market? 7. What is their incentive? 8. What are main features of the market company? 9. Why does competition exist in a free market? 10. Is there a truly free market at the market economy level?

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