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Economics. Microeconomics. Macroeconomics

Ex.1. Read and translate the text.

Economics. Macro and Micro Economics

Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek "management of a household, administration". Economics is the study of the production, distribution and consumption of wealth in human society.

A focus of the subject is how economic agents behave or interact and how economiсs work. In accordance with this, a primary textbook distinction is between microeconomics and macroeconomics. Microeconomics examines the behavior of basic elements in the economy, including individual agents (such as households and firms or as buyers and sellers) and markets, and their interactions. Macroeconomics analyzes the entire economy and issues affecting it, including unemployment, inflation, economic growth, and monetary and fiscal policy.

Macroeconomics may be defined as that branch of economic analysis which studies the behaviour of not one particular unit, but of all the units combined together. Macroeconomics is the study of the economic system as a whole of total production, total consumption, total savings and total investment. The following are the fields covered by macroeconomics:

Theory of income, output and employment with its two constituents, namely, the theory of consumption function, the theory of investment function and the theory of business cycles or economic fluctuations.

Theory of prices with its constituents of the theories of inflation, deflation and reflation.

Theory of economic growth dealing with the long-run growth of income, output and employment.

Macro theory of distribution dealing with the relative shares of wages and profits in the total national income.

The study of macroeconomics is indispensable as it is the main agent for formulation and successful execution of government economic policies. It is also indispensable for the formulation of microeconomic models.

Microeconomics may be defined as that branch of economic analysis, which studies the economic behaviour of the individual unit, maybe a person, a particular household, or a particular firm. It is a study of one particular unit rather than all the units combined together. In microeconomics, we study the various units of the economy, how they function and how they reach their equilibrium. In fact, it is an indispensable tool used in microeconomics. The following are the fields covered by microeconomics:

Theory of product pricing with its two constituents, namely, the theory of consumer behaviour and the theory of production and costs, theory of factor pricing, theory of economic welfare.

VOCABULARY:

сonsumption indispensable

distinction equilibrium

entire economy namely

fiscal policy economic welfare

income tool

output fluctuations

employment constituents

Ex.2. Answer the questions.

1. What analyzes economics?
2. What does the term economics mean?
3. What is the definition of economics?
4. What examines microeconomics?
5. What analyzes macroeconomics?
6. How do you understand the meaning of macroeconomics?
7. What are the fields of the macroeconomics?
8. Why is the study of macroeconomics indispensable?
9. What are the fields of the microeconomics?
10. What are the difference between microeconomics and macroeconomics?

Ex.3. You are going to read the text about economics. Some parts of the text are missing. Choose the list (A-H) the most appropriate part for each gap (1-7) in the text.

Economics

Economics, (1), distribution, exchange, and consumption of (2). Economists focus on the way in which individuals, groups, business enterprises, and governments seek to achieve efficiently any economic objective they select. (3) also contribute to this knowledge: Psychology and ethics try to explain how objectives are formed; history records changes in human objectives; sociology interprets human behaviour in social contexts.

Standard economics can be divided into (4) . The first, price theory or (5), explains how the interplay of supply and demand in competitive markets creates a multitude of individual prices, wage rates, profit margins and rental changes. Microeconomics assumes that people behave rationally. Consumers try (6) in ways that give them as much pleasure as possible. As economists say, they (7). For their part, entrepreneurs seek as much profit as they can extract from their operations.

The second field, (8), deals with modern explanations of national income and employment. Macroeconomics dates from the book, The General Theory of Employment, Interest and Money (1935), by the British economist John Maynard Keynes. His explanation of prosperity and depression centres on the total or aggregate demand for goods and services by consumers, business investors and governments. Because, according to Keynes, inadequate aggregate demand increases unemployment, the indicated cure is either more investment by businesses or more spending and consequently larger budget deficits by government.

A two major fields

B social science concerned with the production

C macroeconomics

D to spend their income

E goods and services

F microeconomics

G maximize utility

H other fields of study

Ex.4. Find the Ukrainian equivalents in the second column.

1. consumption A. пояснювати
2. production B. споживач
3. term C. підприємець
4. exchange D. виробництво
5. branch E. рівновага
6. services F.споживання
7. explain G. термін
8. profit H. процвітання
9. explanation I. інвестиції
10. prosperity J. обмін
11. growth K. прибуток
12. entrepreneur L. галузь
13. investment M. пояснення
14. equilibrium N. зростання
15. consumer O. послуги

Ex.5. Find the English equivalents of the following words.

Cпоживання товарів та послуг, успішне виконання, термін, взаємодіяти, розподіляти, попит та пропозиція, економічні цілі, поведінка людей, заробітна плата, національний дохід, безробіття, робити внесок, галузь економічного аналізу, економічне зростання.

Ex. 6. Form the antonyms from the following words using necessary prefixes.

Employment, necessary, efficiency, available, prepared, important, legal, normal, equal.

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