Measuring economic activity

MEASURING ECONOMIC ACTIVITY

UNIT 8

Comprehension check.

1. What is the effect of decline in government spending on the real output in the short run?

2. How can monetary policy be used to offset the fall in real output?

Grammar: Modal Verbs: expressing requests,

offers, invitations; asking for permission

Assignment 1. Read and learn the following words and phrases.

to require – вимагати;

quantitative – кількісний;

objective basis – об’єктивна основа;

to evaluate – оцінювати, визначати;

value – вартість;

aggregate – загальний, сукупний; ~ output сукупний обсяг виробництва;

domestic product – внутрішній продукт; gross ~ (the GDP) – валовий внутрішній продукт;

gross national product (the GNP) – валовий національний продукт (ВНП); real GNP – реальний ВНП; nominal GNP – номінальний ВНП;

regardless (of) – незважаючи (на);

comprehensive – всеохоплюючий; загальний;

to distinguish – відрізняти;

concept – концепт, поняття;

current price – поточна ціна;

constant price – стала ціна;

to take into account – враховувати; приймати до уваги;

to add – додавати;

amount – 1) загальна сума; 2) кількість, обсяг;

element – складова;

namely – а саме;

net exports – чистий експорт;

standard of living – рівень життя;

to divide – ділити;

per capita – на душу (населення);

share – доля, частка;

welfare – соціальне забезпечення, добробут;

likely – вірогідно, можливо.

Assignment 2. Read and translate the text.

Understanding of how economy works and examination of its future perspectives often require quantitative measures of economic activity. Measuring economic activity serves two basic functions. First, it enables economists to identify economic problems. Second, it provides an objective basis for evaluating macroeconomic indicators.

The ways to calculate the total value of the overall production of goods and services in the economy include evaluating aggregate output, domestic product or national income. All these indicators of the overall state of the economy are based on a common measure called the gross national product (the GNP).

The gross national product is the total market value of final goods and services produced in a single year by factors of production owned by a country’s citizens, regardless of where the output is produced. This is a measure of economic growth or decline. If the GNP is rising, the economy is said to be relatively strong. If the GNP is falling, the economy is said to be relatively weak.

Economists distinguish between two concepts: the gross national product (the GNP) and the gross domestic product (the GDP). The GDP is the total market value of all final goods and services produced in a single year by factors of production located within a country. As we can see, the GNP is a more comprehensive measure as it evaluates the output of all businesses belonging to the citizens of a country regardless of their location.

To distinguish increases in the quantity of goods and services from the increase in their prices economists use the concepts of real GNP and nominal GNP. Nominal GNP is the value of the final output in current prices (prices of that period), whereas real GNP is calculated in constant prices and takes into account the price index for that period (inflation or deflation): Real GNP= Nominal GNP: price index.

In order to calculate the GNP, economists add the amounts that were spent by the three elements of the economy, namely households, businesses, and government, to purchase the final products, and net exports, which is the difference between the country’s exports and imports. We can express this mathematically as C+I+G+E=GNP, where C – consumer household spending, I – investment, or businesses, G – government purchases of goods and services, E – net exports.

A nation’s standard of living is measured by the amount of goods and services available to its citizens. One way to calculate living standard is to divide the GNP by the population: GNP: Population= per capita GNP. GNP per capita shows how much of the GNP is available to one person.

When people discuss what share of the “economic pie” should go to the government, they mean what percent of the GNP should be spent on defense, welfare, education, and other government programs. When the GNP is increasing faster than the population, more goods and services are available per person, and living standards are likely to improve.

Assignment 3. Answer the following questions.

1. Why is it necessary to measure economic activity?

2. What two functions does measuring economic activity serve?

3. What indicators are used to calculate the total value of the overall production of goods and services?

4. How do economists define the term ‘the gross national product’? /‘the gross domestic product’?

5. What is the difference between the GNP and the GDP?

6. What does the GNP measure?

7. Why do economists use the concepts of real GNP and nominal GNP?

8. In what way is the GNP calculated?

9. How is the nation’s standard of living measured? / calculated?

10. What does the GNP per capita show?

11. What does the government spend its share of ‘economic pie’ on?

12. Under what conditions does the standard of living improve?

Assignment 4. Translate into English.

Кількісні виміри; макроекономічні показники; обчислити загальну вартість; кінцеві товари та послуги; відносно сильна/слабка економіка; економісти використовують поняття; індекс цін за цей період; ми можемо виразити це математично як...; урядові закупки товарів та послуг; обсяг товарів та послуг, доступних громадянам; який відсоток ВНП слід витратити на...

Assignment 5. Translate into Ukrainian. Find in the text sentences in which these phrases are used.

To examine…future perspectives; to evaluate aggregate output; common measure; produced in a single year; value of the final output in current prices; whereas; three elements of the economy; consumer household spending; to divide the GNP by the population; per capita; per person.

Assignment 6. Match and learn the pairs of synonyms. Use any 5 of them in the sentences of your own.

A: quantitative, to evaluate, total, domestic, growth, current, to add, amount, share, namely, element;

B: such as, aggregate, component, present-day, numerical, to sum, part, to measure, development, quantity, home.

Assignment 7. Paraphrase the following words in bold style.

1. Economic activity can be measured by numerical indicators. 2. The present-day economic situation shows the signs of gradual development. 3. Factors of production include three main components such as land, labour, and capital. 4. To evaluate the total output for the year we sum the quantities produced in each quarter. 5. Competition among home producers for their part of the local market is very severe.

Assignment 8. Match the pairs of contextual opposites and explain the difference between them.

Strong economy, constant prices, real GNP, inflation, economic growth, deflation, weak economy, current prices, nominal GNP, economic decline.

Assignment 9. Match the term with its definition. Learn the definitions.

The gross domestic product	The inputs in the production process namely land, capital and labour.
Aggregate income	The total quantity of goods and services produced in an economy in a given period.
Factors of production	The total market value of final goods and services produced in a single year by factors of production owned by a country’s citizens regardless of where the output is produced.
The gross national product	The total income received by all factors of production in a given period.
Aggregate output	The total market value of all final goods and services produced in a single year by factors of production located within a country.

Assignment 10. Recognize 6 familiar words and use them to translate the phrases below. Use the phrases translated in the sentences of your own.

Quantitativevaluatelementotalivingovernment

Кількісний вимір, визначити сукупний обсяг виробництва, три складові економіки, загальна вартість товарів та послуг, життєвий рівень населення, урядова програма.

Assignment 11. Correct the following statements. If you partially disagree, begin with: You are not quite right; True, but…; It is true in a way, but… If you find the sentence completely wrong, begin with: I’m afraid, that’s wrong; I think you are mistaken; On the contrary; That’s not quite so.

1. Future perspectives of economy are unpredictable. 2. The terms ‘the GNP’ and ‘the GDP’ are basically equivalent. 3. The GDP is a more comprehensive measure than the GNP. 4. Real GNP is calculated in current prices. 5. ‘Per capita’ means ‘per consumer household’. 6. The living standards of the population will improve if it grows faster than the GNP.

Assignment 12. Make up questions beginning with the words in brackets.

1. According to the bank forecast Ukraine’s gross domestic product will grow 6 percent in 2006 (How much?). 2. The economy of this country is expected to expand by 25 percent this year (When?). 3. Economic growth in Ukraine is fueled more and more by domestic consumption (By what economic factor?). 4. Azerbaijan’s economy is growing faster than any other in the world (How?). 5. Ukrainian economy remains vulnerable to the fluctuations in the prices for energy and metals (What fluctuations?)

Assignment 13. Recall the prepositions.

To distinguish something … something; to take … account; to divide something … something; to be available … somebody; to spend something … something/somebody; … person/capita.

Assignment 14. Translate into English.

1. Економісти розрізняють реальний ВНП та номінальний ВНП. 2. Обчислення реального ВНП враховує індекс цін за даний період. 3. Щоб обчислити рівень життя ми ділимо ВНП на кількість населення. 4. Уряд витрачає значну частину надходжень на програми соціального забезпечення. 5. Зростання ВНП на душу населення означає що більше товарів та послуг стають доступними для громадян.

Grammar: expressing requests, offers and invitations; asking for permission

Для висловлення прохання (to express a request) використовуються модальні дієслова can, could, will, would та фрази would you mind, would you be so kind as (to). Найбільш вживаним є дієслово could. Прохання передається у формі загального запитання, тобто прохання починається з модального дієслова. Слід пам’ятати, що ввічливість (politeness), з якою ми звертаємося до особи, яку просимо виконати щось, залежить від вибору модального дієслова. Модальні дієслова відрізняються за ступенем ввічливості (degree of politeness) наступним чином:

менш ввічлива форма 1.Can you post this letter?

| 2. Will you wait for me for a minute?

| 3. Would you check these numbers?

| 4. Would you mind repeating that?

| 5. Could you answer this letter?

більш ввічлива форма 6. Would you be so kind as to speak louder?

У відповідь на прохання ви можете:

а) погодитись (agree to request), вживаючи фрази Sure, no problem / Yes, certainly/ Yes, of course і повторюючи модальне дієслово у відповіді, напр., Will you wait for me? – Yes, certainly I will.

б) відмовити (refuse a request), вживаючи фрази I’m sorry but that’s not possible / Actually, it’s a bit inconvenient right now, щоб пом’якшити відмову, напр., Could you help me with these reports? – Actually, it’s a bit inconvenient right now. I’m very busy checking some urgent information.

Фраза would you mind + -ing форма основного дієслова означає ‘is it a problem for you?’ Тому, якщо ви а) погоджуєтесь виконати прохання, відповідь буде No, of course not, а якщо б) відмовляєтесь, вживаєте фрази Well/ Actually/ To be honest і вказуєте на причину відмови, напр., Would you mind asking him to come on Tuesday? – a) No, of course not. I’ll be very glad to see him. b) To be honest, I’ll be very busy that day. Let’s make it Wednesday.

Assignment 15. Rank the following requests from less polite to more polite. Agree to and refuse each request, providing your reasons.

1. Would you examine this document? 2. Could you explain to me how to do this? 3. Would you be so kind as to show me the latest data on the GNP? 4. Will you send this report to the statistical department? 5. Would you mind looking through this information? 6. Can you analyze the consumer household spending for me?

Assignment 16. Transform the following orders into polite requests.

1. Show me the letter addressed to our customers in Lviv. 2. Tell everybody to come tomorrow at 8.45. 3. Write down this information – it’s very important. 4. Call the head of the operating department, it’s urgent. 5. Ask the staff to submit their proposals concerning reorganization of production department. 6. Let me know when the director arrives. 7. Find out who is responsible for this mistake. 8. Show me the latest information on sales.

* Для того, щоб запропонувати допомогу (offering help) вживаються модальні дієслова Can I…? Shall I…? та фраза Would you like me +to (infinitive)…?

Напр., Can I/ Shall I/ Would you like me to make a copy for you?

Якщо ми пропонуємо щось (offering things), вживаємо фразу Would you like + noun, напр., Would you like some mineral water? Would you like tea or coffee?

Запрошення щось зробити разом (inviting people to do something with you) висловлюється фразою Would you like + to (infinitive)…? Напр., Would you like to see our new laboratory? Would you like to come and stay with us in London?

Погоджуючись на пропозицію чи запрошення, говоримо Yes, please. Thank you very much/ That would be great, thank you/ That’s very kind of you.

Відхиляючи пропозицію, вживаємо фрази No, it’s all right, thanks/ That’s very kind of you, but I can manage. Відхиляючи запрошення, говоримо I’d love to, but…/I’m sorry, but… та пояснюємо причину відмови.

Assignment 17. Match the forms 1-3 with the uses a)-c).

1. Would you like a/some…? a) offering help

2. Would you like to…? b) offering things

3. Would you like me to …? c) inviting somebody to do something

Assignment 18. Translate into English.

1. Ще кави? – Дякую, з задоволенням. 2. Чи не бажаєте подивитись наш новий каталог? – Дякую, але я його вже бачив. 3. Показати вам наш новий офіс? – Так, це було б чудово. 4. Підемо в кіно завтра? – Залюбки. 5. Принести вам копію контракту? – Це було б дуже люб’язно з вашого боку. 6. Чи не хотіли б ви відвідати торгівельну виставку? – Дякую, це було б чудово.

* Для висловлення прохання дозволити щось зробити (asking for permission) використовуються модальні дієслова can, could, may, напр., Can/Could/May I leave now? Відповідь, що надає дозвіл (giving permission), містить фразу, що виражає згоду та відповідне модальне дієслово (у відповіді на прохання з could вживається can). Заперечні форми cannot, may not передають відмову надати дозвіл (refusing permission); фрази I’m afraid/ To my regret/ Unfortunately вживаються для пом’якшення відмови, напр.,

Can/Could I speak to you on this problem? – Yes, certainly you can.

May I use your phone? – I’m afraid, you may not. I’m expecting a call.

Assignment 19. Match the situations 1-5 with the questions a)-e).

1. Making a request. a) Would you like me to fax this document?

2. Asking for permission. b) Would you like to see this document?

3. Offering help. c) Could you fax this document tonight?

4. Offering something. d) Could I fax this document tonight?

5. Inviting somebody. e) Would you like some more tea?

Assignment 20. Match the situations 1-6 with replies a) – f).

1. Agreeing to request. a) No, it’s all right, I can manage.

2. Refusing a request. b) No, I’m afraid, you may not.

3. Giving permission. c) That’s very kind of you, thank you.

4. Refusing permission. d) Yes, certainly you can.

5. Accepting an offer of help. e) Actually, I’m very busy at the moment.

6. Refusing an offer of help. f) Sure, no problem.

Assignment 21. Compose mini dialogues using the replies from the previous assignment.

Assignment 22. Translate into English using can, could, may.

1.Можна взяти цю книгу? – Звичайно. Я її вже переглянув. 2. Можна відкрити вікно? – Боюсь, що ні. Назовні дуже шумно і ми не зможемо почути лекцію. 3. Можна поговорити з менеджером? – Так, він чекає на вас. 4. Можна скористатись вашим комп’ютером? – Нажаль, ні. Саме зараз я надсилаю важливе повідомлення. 5. Можна побачити ваш диплом? – Будь ласка. Я маю ступінь магістра з економіки підприємств на ринку товарів та послуг.

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