Выполни задания по тексту Text 2. Scarcity and importance of economics 1. Naturally, reality constrains our choices. There has never been enough to satisfy everyone completely. That is what scarcity means. Although per capita real income in the United States increased 50 per cent in just one generation, these middle-class families have had to work hard for their modest gains. (Were they expecting manna from heaven?) As for how hard they worked and the modesty of their gains, it is doubtful whether most other people in the world would regard Americans’ work in air conditioned offices with coffee breaks as “hard” or their standard of living as “just getting by”. However, as someone once said: “Just as soon as people make enough money to live comfortably, they want to live extravagantly.” Even millionaires can have a hard time making ends meet if they try to live like billionaires. The New York Times reporter wrote of one of these middle-class families: After getting in over their heads in credit card spending years ago, their finances are now in order. “But if we make a wrong move,” Geraldine Frazier said, “the pressure we had from the bills will come back, and that is painful.” 2. To all these people — from academia and journalism, as well as the middle-class people themselves — it apparently seemed strange somehow that there should be such a thing as scarcity and that this should imply a need for both productive efforts on their part and personal responsibility in spending. Yet nothing has been more pervasive in the history of the human race than scarcity and all the requirements for economizing that go with scarcity. Not only scarcity but also “alternative uses” are at the heart of economics. If each resource had only one use, economics would be much simpler. But water can be used to produce ice or steam by itself or innumerable mixtures and compounds in combination with other things. A virtually limitless number of products can also be produced from wood or from petroleum, iron ore, etc. How much of each resource should be allocated to each of its many uses? Every economy has to answer that question, and each one does, in one way or another, efficiently or inefficiently. 3. Doing so efficiently is what economics is all about. Whether the people in a given economy will be prosperous or poverty-stricken depends in large part on how well their resources are allocated. Rich resources often exist in very poor countries, simply because the country lacks the economic mechanisms, as well as specific skills, for efficiently turning those resources into abundant output. Conversely, countries with relatively few natural resources — Japan or Switzerland, for example — can have very high standards of living, if their people and their economy are well adapted for allocating and using whatever resources they have or can purchase from other countries. Economics is not about the financial fate of individuals. It is about the material well-being of society as a whole. It shows cause and effect relationships involving prices, industry and commerce, work and pay, or the international balance-of-trade — all from the standpoint of how this affects the allocation of scarce resources in a way that raises or lowers the material standard of living of the people as a whole. Money doesn’t even have to be involved to make a decision be economic. 4. Most of us hate even to think of having to make such choices. Indeed, as we have already seen, some middle-class Americans are distressed at having to make much milder choices and trade-offs. But life does not ask what we want. It presents us with options. Economics is just one of the ways of trying to make the most of those options. While there are controversies in economics, as there are in science, this does not mean that economics is just a matter of opinion. There are basic propositions and procedures in economics on which a Marxist economist like Oskar Lange did not differ in any fundamental way from a conservative economist like Milton Friedman. 5. All sorts of economies — capitalist, socialist, feudal, etc. — must determine in one way or another how the available resources are directed toward their various uses. But how well they do it can lead to poverty or affluence for a whole country. That is what the study of economics is all about and that is what makes it important. Thomas Sowell. Basic Economics: A Citizen’s Guide to the Economy. — Basic Books, a Member of the Perseus Books Group, 2004. — Ch. 1. 1. Read the text and answer the questions below. 1. Why do people become extravagant with money when they get well-off? 2. Which two concepts lie at the heart of economics? 3. How can a country decide which way of resources allocation is the most effective? 4. Do rich resources guarantee prosperity for their owner (e.g. a country)? 5. Which factors affect the standard of living in a country? 2. Decide whether the following statements are True or False according to the text. 1. People eagerly welcome the opportunity to economize on their spending. ___ 2. Wrong decisions on resource allocation lead to economic inefficiency. ___ 3. Countries with the immense resource supply are the richest in the world. ___ 4. Oskar Lange’s and Milton Friedman’s economic theories had little common ground. ___ 5. The chief objective of economics is to make people more well-off and happy. ___ 3. Scan through the text and find the words corresponding to these definitions. para 1 1) used to describe the average amount of smth in a particular place, calculated according to the number of people who live there (adj) ___________________ 2) financial profit, especially when this seems to be the only thing someone is interested in (n) ___________________ 3) events or conditions that cause changes and affect the way a situation develops, especially in economics or politics (n) ___________________ para 2 4) to suggest that smth is true, without saying this directly (v) ___________________ 5) existing everywhere (adj) ___________________ 6) smth that you must do, or smth you need (n) ___________________ 7) almost (adv) ___________________ para 3 8) rich and successful (adj) ____________________ 9) to not have or not have enough of smth that is needed or wanted (v) ____________________ 10) in an opposite way (adv) ____________________ 11) the state of feeling healthy and happy (n) ____________________ 12) a set of beliefs and ideas from which opinions and decisions are formed (n) ____________________ para 4 13) a situation in which you balance two opposing situations or qualities (n) ____________________ 14) a lot of disagreement or argument about smth (n) ____________________ 15) an idea or opinion (n) ____________________ para 5 16) to make a strong decision (v) ____________________ 17) welfare, riches (n) ____________________ 4. Match the term with its definition. 1) real income a) the money which is used for a particular purpose, especially by a government or organization 2) standard of living b) the difference in value between the goods a country buys from abroad and the goods it sells abroad 3) spending c) the value of earnings/income, etc. after the effect of rising prices is considered 4) alternative uses d) a balance between two opposing things, that you are willing to accept in order to achieve smth. 5) balance-of-trade e) the amount of money and comfort people have in a particular society 6) trade-off f) ways of using smth. differently 5. Use the words from exercise 4 to fill in the gaps. 1. _____________ refers to the level of wealth, happiness, comfort, material goods and necessities available to a certain socioeconomic class in a certain geographic area. ______________ includes factors such as income, quality and availability of employment, class disparity, poverty rate, quality and affordability of housing, etc. 2. A ____________ is a situation that involves losing one quality or aspect of something in return for gaining another quality or aspect. It implies a decision to be made with full comprehension of both the upside and downside of a particular choice. 3. The ______________ is the difference between the monetary value of exports and imports of output in an economy over a certain period. It is the relationship between a nation’s imports and exports. 4. ______________ includes all government consumption, investment but excludes transfer payments made by a state. 5. ______________ and scarcity lie at the heart of economics. This science would not exist at all if resources were abundant or had only one use. 6. _____________ is the income of individuals or nations after adjusting for inflation. It is calculated by subtracting inflation from the nominal income.