Text 3 banks

The purchasing power of money

The value of money

In a money economy, money serves as a

Most of the money in circulation consists of

a. paper money.

b. coins.

c. checking accounts.

d. savings accounts.

a. medium of exchange.

b. measure of value.

c. store of value.

d. all of the above.

a. can increase or decrease.

b. remains the same at all times.

c. increases with the passage of time.

d. rises when prices rise.

a. increases during periods of inflation.

b. decreases during an inflation.

c. decreases during a deflation.

d. is unaffected by inflation or deflation.

Exercise 2.4 Find the equivalents:

1. Medium of exchange	a. Сучасні гроші
2. Measure of value	b. Грошова маса
3. Store of value.	c. Виходити з обігу
4. To be any substance	d. Бути будь-якою річчю
5. To issue money	e. Міра вартості
6. Modern money	f. Засіб обміну
7. To go out of circulation	g. Запас вартості
8. Paper/soft money	h. Випускати гроші в обіг
9. Money supply	i. Паперові гроші
10. To express worth	j. Виражати вартість
11. To be converted	k.Плата, платіж
12. Payment	l. Бути конвертованим

Exercise 2.5 Match the words with their definitions:

1.A salary	a) an amount of money which you lend to someone
2. A loan	b)extra percentage paid on a loan
3. A debt	c) money which is in the form of coins and notes, not cheques
4. Cash	d) paid as a punishment for breaking the law
5. Wages	e) money paid by a divorced father to his former wife for the upkeep of his children
6.Alimony	f) a fixed amount which is paid, usually monthly, to workers of higher rank
7. Interest	g) an amount of money you receive, usually weekly, in return for labor or service
8. A fine	h) paid at the restaurant after eating
9. A bill	i) a sum of money which is owed to someone
10.A grant	j) money paid by the state, usually to students

Exercise 2.6 Complete the sentences choosing one of the options:

1. When you retire at the age of 65, you receive a _____ from the government.

a) pension b) grant c) fine

2. If production in that factory exceeds the target, the workers get a _____.

a) premium b) bonus c) donation

3. Income tax is _____ to one’s annual income.

a) dependent b) related c) based

4. The _____ of living has risen by 25 % in the last six months.

a) expense b) price c) cost

5. The kidnappers demanded a _____ of $ 1,000,000.

a)reward b) penalty c) ransom

6. The President admitted taking ______ and had to resign.

a) bribes b) premiums c) fees

Exercise 3.1 Study the vocabulary:

1) to be concerned	1) бути пов’язаним
2) an effort	2) спроба
3) to prevent	3) запобігати
4) to originate	4) брати початок
5) current account	5) поточний рахунок
6) a profit	6) прибуток
7) an interest	7) відсоток
8) liabilities	8) пасиви
9) assets	9) активи
10) to lend excess fund	10) надавати кредит

Exercise 3.2 Read and translate the text:

Banks are closely concerned with the flow of money into and out of the economy. They often co-operate with governments in efforts to stabilize economies and to prevent inflation. They are specialists in the business of providing capital, and in allocating funds on credit. Banks originated as places to which people took their valuables for safe-keeping, but today the great banks of the world have many functions in addition to acting as guardians of valuable private possessions.

Banks normally receive money from their customers in two distinct forms: on current account, and on deposit account. With a current account, a customer can issue personal cheques. No interest is paid by the bank on this type of account. With a deposit account, however, the customer undertakes to leave his money in the bank for a minimum specified period of time. Interest is paid on this money.

The bank in turn lends the deposited money to customers who need capital. This activity earns interest for the bank, and this interest is almost always at a higher rate than any interest which the bank pays to its depositors. In this way the bank makes its main profits.

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