BP E Comprehension

Now read the text again and match each paragraph with the correct heading.

PARAGRAPH 1....................

PARAGRAPH 2....................

PARAGRAPH 3....................

PARAGRAPH 4....................

PARAGRAPH 5....................

What aggregate demand includes

Two types of aggregate supply curve

The relationship between aggregate demand and price

Wiry are aggregate supply and demand important to governments?

What causes aggregate demand to shift?

Before you listen

Discuss the following with your partner.

The gross domestic product (GDP) is a way of measuring the income of a whole nation.

-» How do you think GDP is calculated?

-» Why do you think some countries have a larger GDP than others?

Which countries in the world do you think have a large GDP?

Which ones have a small GDP?

0 F Listening *)))

Now listen and complete the summary.

The gross domestic product is the total value

of all the (1)....................... supplied by a

country during a whole (2)..........................

. It is often called the (3)..........................

It is a way for the government to measure

the economic (4)......................... of the

country. The GDP per capita is the GDP

divided by the number of (5).............................

It is a useful measure of a nation's

(6)........................ In 2005. Luxembourg had

a per capita GDP of $ (2)........................... In

the same year, the figure for Burundi was only $ (8)

Ff G Speaking

Discuss these questions with your partner.

Why is it important for a coimtry to have steady economic growth?

The GDP of a country is sometimes used to measure standard of living. Do you think this is a good measure for standard of living? Why / Why not?

Task

Work in groups of three or four.The diagram below shows the aggregate demand and aggregate supply curves for a country.Talk to each other about how the curves could change for each of these situations.

the government decides to spend billions of pounds on road building

there is a large increase in the price of petrol

the government increases income tax rates by five per cent

wages increase a lot

Figure 1: Aggregate Demand and Supply Real Hatwnal Oitput

Use the space below to write your notes.

Notes:

Prices

Imagine you're a farm worker in America in the 1930s.You've just lost your job because of the Great Depression. Write a letter to your cousin in Russia.

Look back at the unit and make notes before you start.

Letter from history

Dear [your cousin Is name],

PARAGRAPH 1

Tell your cousin the bad news about losing your job and what difficulties you're facing.

Useful words and phrases: made redundant, struggle to get by, landlord demanding rent, bills to pay, go into debt

PARAGRAPH 2

Explain the situation in America: how the stock market crash happened, the Depression. Head the notes from С Listening on page 62.

Useful words and phrases: stock market, crash, fall in demand for produce, businesses closing down

PARAGRAPH 3

Explain what life is like in America now, especially for farmers and farm workers.

Useful words and phrases: high unemployment, families struggling to get by. people depressed, people leaving their homes for the city

PARAGRAPH 4

Say what you plan to do to find work.

Here are some ideas: move to tho city to find work, join the army, try to sell something valuable you own and buy a ticket to Europe.

Sign off

Иа; rnillan С i j ' ri r to Efoiomiti! I г i 12 65

Write 100-150 words

Pronunciation guide

Devastating 'dev.Weitii] Fiscal Tiskl

Mechanism 'mek.im/nm Monetary тлпнп Recession rise|n Availability.iveibbtloii Axis ';i'k<is

Match words from box A to words in box В to make expressions we use in economics.You can use words in box В more than once.

A_____________________________________________

в? В The words in bold in this newspaper story have been wrongly printed. Put the letters in the. correct order to make the right word. 66 N¹ а т. idrtftEccioKwtRe.i 'Vcibjj-i • e t * rt>

absolute aggregate disposable fiscal income mixed monetary pension poverty public relative

demand gap goods income policy poverty scheme trap

Now match the expressions to their meanings.

services that the government provides because no one else will

services and goods that the government provides because they are good for us

not having enough money to survive...................

to be much poorer than other people in the same country

the government's decisions about taxation and spending

the government's decisions about interest rates and money in the economy

the money you can spend after you have paid tax

a situation in which it is impossible to escape from being poor

all the services and goods that are bought in the economy

a way to save money for old age....................

Revision Vocabulary Units 9 to 12

the difference between the highest earners and the lowest earners

Economic hard times set to continue

The government released more gloomy economic figures today. Unemployment lias risen again this mor.th. and now ten per cent of the (1) krowforec are without a job. At tho same time, the Bank of England has said that (2) vinnetmest by companies lias decreased dramatically. 'Businesses simply don't want to be involved in (3) srki-agtkni when the economy is like this.' commented John Cash, a senior director with the bank.

But tho people worst affected are the unemployed and their families. Many are now spending their life (4) gisvans in order to survive. Government Minister. Alison Wellby said yesterday that. "The (5) frelwae of ordinary people is our most important concern'. To prove this, the government has promised to increase spending on (6) frantres payments such as unemployment (7) fitsbeen. However, this could be a sign that the (8) cresseion will probably continue into next year. It seems that even in the (9) glon nur things are not looking good.

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Unit

Before you read

Discuss these questions with your partner.

-* What is money?

-» Can anything be used as money?

Could stones and leaves be used instead of coins and notes?

A Vocabulary

Choose the correct word or phrase.

One reason why people buy gold is because it

holds its value / is taken (or granted.

When we buy things, we money

for goods.

Diamonds are valuable because they are so

intrinsic / rare.

The dollar is the of the USA.

When people goods, they

simply exchange one good for another.

Banks will only lend to people who can to pay back the loan.

Some shops won't accept credit cards. They will only take

When something

people don't think it has great value.

Coins and notes are used to value.

Metals have value because they

can be used to make things.

If money can easily bo moved around and used we say it has

Centuries ago people paid using

. such as gold and silver.

.like

banknotes and coins, has no intrinsic value. It only represents value.

IF Reading 1

Money

The cash we use every day is something we take for granted, hut for thousands of years people trailed without it. Ik-fore money was invented, people used a system called burti rina Bartering is simply swapping one good for another. Imagine that you have milk, for example, and you want eggs. You simply l'ind someone who has cl£s._ltu| wants milk - ami you swap! However, you can set that this isn't a very convenient way to trade.

f irst of all. you can't he sure that anyone will want what you've got t<> offer. You have to hope that you'll be lucky and find someone who has what you want and that he or she wants what you've got The second problem with bartering is that many goods don't hold their value For example, you can't keep your milk for a few months and then barter it. Nobody will want it!

и

и 67

After some time, people realised that some goods held their value and were easy to carry around and to trade with. Fxamples were metals like copper, bron/e and gold and other useful goods like salt. These are examples of comminlity money.

With commodity money, the thing used lor buying goods has inherent value. For example, gold has inherent value because it is rare, beautiful and useful. Salt has inherent value Ivcause it makes food tasty. It you could buy things with a bag of salt, it meant you could keep a store of salt ami buy things anytime yon needed them, in other words, commodity money can store value

I sing commodity пюпс\ was much more convenient than ordinary bartering, but it still had drawbacks < >nc of these drawbacks is that commodity money often lacks litfuulity Liquidity refers t.i how easily money can circulate There is obviously a limit to how much salt you can carry around' There's another problem with commodity money not everyone may agree on the value of

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