1. What do businesses need financial reserves for?
2. What do companies need working capital for?
3. What are the four main ways of obtaining capital?
4. What is meant by the retained profit?
5. Is retained profit distributed to shareholders?
6. What are the main types of lenders to business?
7. When do companies make share flotations?
Ex.2. Sum up what you remember about:
a) financial reserves;
b) retained profit;
c) borrowing;
d) share flotations;
e) grants and loans.
Grammar Revision
| First Conditional: Form: if + Present Simple/Continuous, + will + infinitive Use: We use the first conditional: s to talk about a likely situation and its probable result in the future. If the weather keeps warm, well go to the river. s to give advice, threats and to make promises. If I have time, Ill help you. |
Ex.1. Finish these sentences using the first conditional.
1. If he washes my car, .
2. If you smoke, .
3. If you need a lot of money, .
4. If you fail your test in math, .
5. If she loses her weight, .
6. If you phone me tonight, .
7. If I go to the party, .
8. If it rains, .
9. If I eat a lot of sweets, .
10. If we get this loan, .
11. If you skip classes, .
12. If you buy a new flat, .
13. If inflation rises, .
14. If I can afford it, .
15. If you feel underpaid .
Ex.2. Put the verbs in brackets into the correct form.
1. If you (see) Mary, tell her I have a message for her.
2. If he (refuse) to help, Ill have to manage without him.
3. What will we do if he (not meet) us?
4. If I (get) a work permit, Ill stay for another three weeks.
5. If you (help) us, the job will only take an hour.
6. If I find his passport, I (phone) him at once.
7. If you leave your car unlocked, someone (steal) it.
8. Unless she (sell) more, she wont get much commission.
9. If I lend you $ 100, when you (repay) me?
10. If we (make) share issues this month, well raise our finance.
11. If you manage to get cheap loans, the firm (stay) in business.
12. If we (need) extra capital, well apply at the bank for a loan.
13. If you (be) in difficulties with money, Ill help you by all means.
14. If I (finish) this work before six, I'll let you know.
Ex.3. Translate into English:
1. , .
2. , .
3. , .
4. , .
5. , .
6. , .
7. , .
8. , .
9. , .
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10. , .
Speech and Discussion
Ex.1. Define the following terms:
s retained profit;
s shareholders;
s share offering.
Ex.2. Interview the financial manager in a large corporation. Ask him about the ways his corporation obtains capital.
Ex.3. Discuss with your groupmates which way of obtaining capital is more suitable for a small firm. Why?
Ex.4. Familiarize yourself with the following idioms. Consult your dictionary and translate the sentences into Ukrainian. Think of situations where you could use them.
1. He gave me one of his sandwiches, and I gave him some of my candy; share and share alike.
2. He stole the lions share of the companys profit.
3. In my book, you dont complain about the staff to the boss until you have discussed it with them first.
4. Bob lies for the sake of lying. It has become second nature to him.
5. Youll give us a bad name if you talk to our customers like that!
Ex.5. Comment on the following:
Finance is, as it were, the stomach of the country, from which all the other organs take their tone.
(W. Gladstone)
Lesson 3
Text: Financial Centres
Grammar: Second Conditional
Terms to remember:
| trade (v) | ™ | (- in;) |
| stock market | ™ | |
| commodity market | ™ | |
| foreign exchange (forex) market | ™ | |
| interest rate | ™ | / |
| raise capital (v) | ™ | , |
| securities | ™ | |
| market-maker | ™ | , |
| stockbroker | ™ | / |
| bond | ™ | |
| bull market | ™ | , ; |
| bear market | ™ | , ; |
Financial Centres
Financial centres bring together investors and the businesses that need their investment.
Things traded in financial centres include: securities on the stock markets; commodities such as cereals, coffee and precious metals on the commodity markets, currencies on the foreign exchange or forex markets.
The stock market is the financial centre of any country. It reflects any change in the economy. It is sensitive to interest rates, inflation and political events. In a very real sense, it has its fingers on the pulse of the entire world.
The stock exchanges exist to allow investors to buy and sell shares, and companies to raise capital. They also provide a market for government loans and securities. On the market, the main operators are the market-makers who trade in a group of shares, and stockbrokers who act as agents for their clients. Market-makers sell to stockbrokers.
A share (BrE) or stock (AmE) is any of the equal parts into which the capital of a company is divided. Securities are shares and bonds (official papers given by a company or the government, to prove that you have lent them money and that they will pay it back with interest).
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When prices in a stock market or currency market are rising people talk about a bull market. When prices are falling people talk about a bear market.
Exercises in Word Study
Ex.1. Form nouns from the following verbs:
reflect, exist, invest, govern, operate, act, divide, prove.
Ex.2. Give the English for:
; ; ; ; ; ; ; ; ; ; ; ; .
Ex.3. Match words from list A with words from list B that have a similar meaning:
| A | B |
| goods change sensitive entire allow foreign exchange securities market prove | confirm whole permit foreign currency stock exchange alteration perceptive commodities |
Ex.4. Find suitable opposites to the following words:
to rise, to borrow, to include, partial, to unite, to prove.
Ex.5. Match the nouns in the left-hand column with the verbs in the right-hand column:
| securities commodities bonds | pay off redeem retire deal in issue trade in make advertise sell |
Ex.6. Look at the words and phrases in the box. Match them with the correct definition from the list below:
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1. a market where stocks and shares are bought and sold under fixed rules, but at prices controlled by supply and demand;
2. a place where raw materials and some manufactured goods are bought and sold;
3. a market where foreign currencies are traded;
4. a person or organization that buys and sells stocks and shares;
5. a certificate of debt;
6. shares and bonds;
7. a market in which the general level of share prices is rising;
8. a market where the general level of share prices is falling;
9. the amount of interest that is paid for money at a savings bank, on a bond, etc;
10. a rise in prices and lowering of currencys value.
