Text 2 money

Exercise 1.3 Decide if the statements are true or false. Correct the false ones.

1. The operations of individual banks considerably differ throughout the world.

2. Banks use their depositors’ funds to make loans and buy securities.

3. If you have a checking account in a bank you cannot get your money back whenever required.

4. Risky loans have a lower rate of return.

5. Banks are heavily regulated by the government.

6. Banks play a vital role in a country’s financial system.

Exercise 1.4 Match the term with its definition:

1. Profit motive	a) able to be trusted to pay back money that is owed
2. Depositor	b) an organization whose business is providing insurance
3. Loan	c) the part of an income that is kept for a particular purpose or for unexpected expenses in the future
4. Loss	d) money that an organization such as a bank lends and sb borrows
5. Liquidity	e) the desire to make money, which is the reason that most businesses exist
6. Reserve fund	f) money that has been lost by a business or an organization
7. Creditworthy	g) a person or an organization that puts money in a bank account
8. Insurance company	h) the state of owning cash or things of value that can easily be exchanged for cash in order to pay debts

Exercise 1.5 Fill in the gaps with the words and phrases:

deposit; borrowers; liquidity; loan; funds; interest rates; loss;

1. We are now operating at a _____.

2. The Central bank has cut ______ to try to stimulate economic growth.

3. The bank has a lot of money from lending to high-risk _____.

4. Payments are placed on ______ to earn interest.

5. Asset sales are intended to improve the company’s ______.

6. Many people take out a ______ to buy a new car.

7. They ran out of ______ before they could finish the building work.

Exercise 1.6 Complete the sentences choosing one of the options:

1. At this bank you can get 14% ____ on your savings.

c) interest b) rate c) rent

2. I want $ 500-worth of French francs. What is the _____ rate, please?

c) currency b) exchange c) money

3. Every Friday Fred ______ money out of the bank.

c) cashed b) drew c) stole

4. The ______ of the pound has fallen recently.

c) expense b) worth c) value

5. Miss Thrifty phoned the bank to _____ how much money there was in her account.

12) control b) inspect c) check

6. The _____ of the bank where I work is in the suburbs.

l) branch b) seat c) quarter

7. In order to buy his house Mr Not-Too-Rich had to obtain a large ____ from his bank.

a) loan b) capital c) debt

Exercise 2.1 Study the vocabulary:

1) to be any substance	1) бути будь-якою річчю
2) to be accepted as	2) бути прийнятим як...
3) payment	3) плата, платіж
4) to be converted into	4) бути конвертованим у...
5) to be very portable	5) тут: легко переносити
6) to be very durable	6) тут: довго використовуватися
7)... last a long time under normal use	7) за нормального використання довго перебувають в обігу
8) to go out of circulation	8) виходити з обігу
9) to rate high in divisibility	9) високо цінити за можливість поділятися
10) denomination of coin	10) вартість монети
11)money supply	11) грошова маса

Exercise 2.2 Read and translate the text:

Basically, money is what money does. This means that money can be any substance that functions as a Medium of Exchange, a Measure of Value, and a Store of Value.

As a medium of exchange, money is something generally accepted as payment for goods and services

As a measure of value, money expresses worth in terms that most individuals understand.

Money also serves as a store of value. This means goods or services can be converted into money that is easily stored until some future time.

The different forms of money are in use in the United States today. The most familiar are coin and currency. The term coin refers to metallic forms of money. The term currency refers to paper money issued by government. While money has changed in shape, kind or size over the years, modern money still shares many of the same characteristics of primitive money. Modern money is very portable when people carry checkbooks. For example, they really are carrying very large sums of money since checks can be written in almost any amount.

Modern money is very durable. Metallic coins last a long time under normal use and generally do not go out of circulation unless they are lost. Paper currency also is reasonably durable. Modern money also rates high in divisibility. The penny which is the smallest denomination of coin, is more than small enough, for almost any purchase. In addition, checks almost always can be written for the exact amount. Modern money, however, is not as stable in value. The fact, that the money supply often grew at a rate 10 to 12 per cent a year was considered as major cause of inflation.

Exercise 2.3 Define which of the following items best completes the statement:

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