Болсуновская Л.М., Абрамова Р.Н., Матвеенко И.А. (ред.) Petroleum engineering. Teachers book. Нефтегазовое дело. Книга для учителя
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10. Foreign firms are interested in (внедрение – introducing) their goods
to new markets.
Exercise 22. Discuss.
In group discuss the following questions based on the material of Unit 1.
1. The significance of economics nowadays.
2. The reasons why some people are rich while some are poor.
3. The main types of economic systems.
4. Future of Russian economics.
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UNIT 2
FINANCE
Lead-in. T. elicits the ideas from the students as they suggest things
connected with Finance and make collective mind map (spidergram) on the
board as the ideas are suggested, so that they can see how T. draws out the
aspects of the topic. The reasoning behind mind map is that Ss do not think in
an ordered or linear way, but rather explore a topic by moving between its
various aspects.
The next stage in this procedure is discussing the questions connected with
financial institutions.
This activity will prepare Ss to work with the topic of the Unit 2.
Exercise 1. Read and learn the pronunciation.
Exercise 2. Pay attention to the stress in the following words.
T. comments on pronunciation of the words. Pay special attention to the
word stresses and elicit all the mistakes connected with mispronunciation
of the sounds by reading the words aloud.
Exercise 4. Answer the following questions.
1. What are the businesses called that distribute or deal in money? –
financial institutions.
2. What are the most familiar financial institutions? – commercial banks,
savings banks, savings and loan associations, mutual savings banks,
credit unions, investment banks and so on.
3. What services does a commercial bank offer to its customers? –
checking and savings accounts, loans, and credit cards. It also deals in
some brokerage, insurance, and financial advice.
4. What do the borrowers do sometimes to back up the loan? – borrowers
pledge collateral to back up the loan.
5. What types of accounts do commercial banks offer to their customers?
– demand deposits and time deposits.
6. What does the interest rate depend on? – it depends on financial
reputation of a person or a company.
7. What kind of technology are banks using now? – computer
technology.
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8. What are the electronic funds transfer doing with money? – it transfers
money from individuals to the bank, from bank to bank, and from city
to city through an electronic system.
9. What new services are the automatic teller machines providing for the
customer? – customer can get cash, make loan payments, or transfer
money from one account to another at any time of the day or night.
10. What innovation makes it easy for the customer to handle all kinds of
financial transactions outside his home state? – electronic funds
transfer.
11. What process in modern banking is urging the banks to diversify? –
competition.
Exercise 5. Fill in the blanks with adjectives many and much:
1. __many__insurance companies protect their customers against risk.
2. It takes one__much__money to join a credit union.
3. Starting a business without financial support from the bank may cause
you __much__trouble.
4. Banks in the USA are subject to_many_government regulations.
5. Savings and Loan Associations attract_many_small savers who do not
want to have any risk.
Exercise 6. Substitute.
Statement: There are many commercial banks that offer their customers a
wide range of financial services.
Example: There are a lot of commercial banks that offer their customers
a wide range of financial services.
financial institution clients individuals and businesses
provide for banking render
different were a number of
Possible variant:
There are many financial institutions that provide for individuals and
businesses a number of financial services.
Statement: Banks are now using computer technology to perform various
financial transactions.
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Example: Financial institutions are now using computer technology to
perform various financial transactions.
business
electronic
numerous
deals these
at present
employing
methods
handle
Possible variant:
Banks at present are employing electronic methods to handle numerous
financial transactions.
Exercise 7. Translate into English.
1. Are there any free bank services? No, there are no free bank services. 2.
Many banks charge fee for their service. 3. Companies with good
financial position are given the prime rate. 4. Is there much money on
your checking account? Yes, there is much. 5. There is one commercial
bank and three insurance companies in my note book.
Exercise 8.
Listening.
A. Before listening discuss the following statements. How do you think
whether they are true or false?
1. The earliest kind of money was used about 3,000 years ago.
2. Shells were used a kind of fiat money.
3. The first metal coins appeared in Greece.
4. The first coins were round.
5. Paper money first appeared in China.
6. The idea of paper money traveled quickly to Europe.
B. Now listen to someone talking about the history of money and check
your answers.
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Some useful vocabulary:
shells – ракушки
cowry – раковины, до сих пор заменяющие деньги у некоторых
народов Азии и Африки
fiat – признанный, узаконенный
lump – кусок
Tapescript
One of the earliest kinds of money that we know about were shells called
cowries. Over 3,000 years ago, the people who lived around the Pacific and
Indian Oceans started to use cowries as a kind of fiat money. They were
still being used until quite recently in some societies. The first modern coins
appeared about 2,500 years ago around the Mediterranean in what is now
Turkey. At first they were just lumps of silver, but someone somewhere
made a round, flat coin and the design stayed! It took a long time for paper
money to appear. It was invented by the Chinese about 1,200 years ago,
probably because there wasn't enough metal available for coins. It took
many more centuries before the idea reached the rest of the world. For
example, the first paper notes in Europe appeared in the 17th century in
Sweden.
Answers:
1. T, 2. T, 3. F, 4. F, 5. T, 6. F
Exercise 9. Read the dialogue.
Before reading the dialogue study Words and phrases. Read the dialogue
in pairs. Ask Ss how they understand the word pool.
Pool – a kind of credit union which is formed from the investments of
persons who work at one department, company, etc. Those who make
investments into the pool can ask for a loan (financial support) if
necessary.
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Exercise 10. Make up similar dialogues.
Work in group and make up dialogues according to the following topics:
1. You are starting a new business and apply for funds to a commercial bank.
2. Your company has a good reputation and a commercial bank provides
the prime rate for you.
3. You deposit some of your money into a bank which offers you
accounts of two types. Choose one of them.
Exercise 11. Translate the following sentences.
1. Government regulations reduce the range of services a bank can offer.
2. State bank does not allow to pay interest in checking account.
3. Financial institutions offer new types of deposits.
4. Some banks do experiments with accounts.
5. Many companies install teller machines in their buildings.
6. Federal government uses electronic system of money transfer.
Exercise 12. Put the verb in brackets into the right form.
1. Large commercial banks (install) automatic teller machines
nowadays.
2. Customers usually (use) their debit cards to transfer money from their
checking account to the merchant's account.
3. As a rule a customer (pays) a fee of forty cents for each transaction
outside the state.
4. Financial supermarkets (appear) all over the USA these days.
5. The customers often (look) around for the highest return on their
savings or the lowest rate they can get on a loan.
6. Small banks now (compete) with larger banks by finding a special
need and meeting it.
Exercise 13. Make up sentences according to the following models.
Before doing this exercise T explains the difference between the phrases
I am thinking of and I am going to.
Model: to open a checking account
I am thinking of opening a checking account.
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1. to use the electronic funds transfer system.
2. to transfer money outside the state.
3. to provide new services to my customers.
4. to buy 100 shares of stock.
5. to sell some bonds.
6. to plan a number of financial transactions.
7. to assign my major customers a personal banker.
Model: to balance my checkbook at last
I am going to balance my checkbook at last.
1. to drop unprofitable services.
2. to ask for financial advice
3. to wait on customers
4. to install an automatic teller machine in my shopping center
5. to attract more customers by providing less expensive services
6. to pay a fee of a dollar for this banking transaction
7. to use my debit card to a better purpose
Exercise 14. Read the text.
Before reading the text study Words and expressions which are given
below. While reading, help Ss with difficult extracts explaining and
translating some words, if necessary. Ask different Ss to read and
translate.
Exercise 15. Answer the questions.
1. Was financial management always a major problem for business? –
financial management was not a major concern for a business. A
company used to establish relations with a local bank.
2. What did a bank do in the past to help a company operate? – The
bank handled the financing and the company took care of producing
and selling.
3. What does financial management start and end with? – Financial
management begins with the creation of a financial plan and ends
with the company's objectives.
4. What does the financial plan include? – The plan includes timing and
amount of funds and the inflow and outflow of money.
5. What happens to the company if the outflow of funds exceeds the
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inflow? – If cash outflow exceeds cash inflow the company will run
out of cash.
6. What are the major financing techniques? – short-term and long-term
financing.
7. What are the most popular outside sources of short term funds? –
The most popular outside sources of short term funds are trade credit,
loans, factors, sales finance companies, and government sources.
8. What is a line of credit? – the amount a customer can borrow without
making a new request, simply by notifying the bank.
9. What firms are able to sell commercial papers? – only firms with a
good financial reputation can sell it.
10. When does a business need long term sources of funds? – When a
business needs funds to construct a new assembly line or to do
extensive research and development which may not begin to bring in
revenues for several years.
11. What are the two ways of increasing the company's debt? – by
getting loans or by selling bonds.
12. What does a company do if it wants to be free from the lender's
restrictions? – it may issue bonds.
13. Why is it difficult to sell debentures? – It is difficult, if not
impossible, to find investors who are willing to buy bonds which are
not backed up by collateral.
14. What makes it possible to retire bonds before they mature? –
company may retire bonds before they mature if the indenture
agreement contains a call provision.
15. What does the conversion privilege allow the bondholders to do? – It
allows bondholders to convert their investment into a stated number
of shares of common stock.
16. When do the investors profit from conversion? – If the price of the
company's common stock is going up, the investors can profit from
conversion.
Exercise 16. Study the figure below and describe the process of financial
management.
Make up sentences according to the scheme given on Figure 1.
E.g. Before starting any enterprise, company should state the objectives.
Then it must determine its money needs. If company needs exceed
revenues the company will have excess of investments. In case when it is
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the objective of the company, the financial plan will work and the
company will move ahead.
Fig. 1
1. Company
Objectives
Determine
Money Needed
Revise
Plan
Invest
Excess
Needs
Exceed Revenues?
Can Outflows be
Reduced?
Find Sources of Funding
Financial Plan is Working
and Firm is Moving Ahead
Are Objectives Being
Achieved?
Yes
No
No
Yes
No
Yes
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Exercise 17. Translate into English.
1. The seasonal financial needs of a company may be covered by short
term sources of funds. 2. The company must pay the debts within one
year. 3. Businesses spend short-term financing funds in case of
emergency. 4. Company can use trade credit, loans, factors and
government sources. 5. About 60 % of all business transactions involve
trade credit. 6. Normally the buyer does not pay for goods and service. 7.
Invoice requesting payment within a settled time period. 8. The buyer
uses goods and services without paying for them. 9. A company can use
the trade credit as a source of savings. 10. If a buyer pays within 20 days
instead of 40, he gets a 2 percent discount. 11. Commercial banks offer
their customers unsecured loans. 12. Only customers with an excellent
credit rating can get an unsecured loan. 13. A company can pledge
collateral to back up the loan. 14. Sometimes a company might sell its
unpaid debts to a factor. 15. When customers make the payments on their
accounts, the money goes directly to the factor. 16. Sometimes companies
sell commercial papers.
Exercise 18.
Listening.
A. Before listening read the summary which explains what open market
operations are. Try to complete the gaps with your own words.
The government can create (1) shortages of money for commercial
banks by (2) selling securities. Securities are a way to (3) lend money
to the government at an agreed rate of interest. This is what is known
as open market operations. When people buy securities the money
supply (4) decreases. This causes (5) shortages in the commercial
banks’ (6) reserve accounts, so they have to (7) borrow money from
the central bank.
B. Listen and check your answers.
Tapescript
So how can the government make sure that commercial banks have a
shortage of cash at the end of each day? One way is for the government to
sell something that's very expensive. When the government sells
something, the people or companies that buy it will take large amounts of