English for Business Administration: Lesson 1: Economic activity (Exercise 1)

English for Business Administration: Lesson 1: Different economic systems (Exercise 1) Đọc kĩ đoạn văn dưới đây Competitive market capitalism contains two major decision-making units whose actions are coordinated through market exchange. The first is the business firm, ...

English for Business Administration: Lesson 1: Different economic systems (Exercise 1)
 

Đọc kĩ đoạn văn dưới đây

Competitive market capitalism contains two major decision-making units whose actions are coordinated through market exchange. The first is the business firm, which buys resources from households and transforms resource inputs into outputs of products and services that it sells to households. The second is the household, which owns and sells resources to firms and purchases outputs from them.

The two kinds of market relations, as well as the two basic units of economic decesionmaking, are interdependent. The demand for resource inputs is derived from the demand for final products because firms produce to sell (at a profit) to consumers. Resource inputs, in turn, are required to create outputs. Consumers are able and willing to purchase products because they have incomes. Consumers obtain income through the sale or loan of their resource to firms, who in turn organize and coordinate factors of production to produce outputs from these outputs. Competitive market captalism is based on some basic assumptions. One assumption is that both firms and households desire to maximize their economic well-being through market exchange. Business firms are assumed to pursue profit maximization and households try to
maximize utility or satisfaction. Both try to buy at the lowest possible price (for a given quality of goods) and to sell at the highest possible price. The other major assumption is that markets are competitive, which means there are many buyers and sellers, products are substituable, buyers and sellers have a lot of knowledge of the market and resources are able to move freely between users.

1. Trà lời câu hỏi

1. What are the two majors decision-making units which market capitalism contains?
2. How are the actions of business firms and households coordinated?
3. From whom does the business firm buy resources and sell outputs?
4. What does the demand for resource inputs depend on?
5. What do firms do with the resources they buy from households?
6. How can consumers get money to buy products sold buy firms?
7. What do both households and business firms do through market exchange?
8. What does it mean that “market are competitive”?

2, Đọc lại đoạn văn và trả lời True/ False

1. Business firms and households are independent of eachother.
2. Firms and households are boh buyers and sellers.
3. Demand for the products of a firm depend on the demand for the resources.
4. Knowledge of the market is not necessary for a competitive market.
5. Households organize and coordinate factors of production to produce outputs.

Đáp án

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Exercise 1

1. The business firm and the household
2. They are coordinated through market exchange.
3. Households
4. The demand for final products
5. They transform resourse inputs into outputs of products and services.
6. They get money from the sale or loan of their resourse to firms.
7. They maximize their economic well-being: Business firms maximize their profit and hoseholds maximize their utility or satisfaction.
8. It means that there are many buyers and sellers, products are substituable, buyers and sellers have a lot of knowledge of the market and resources are able to move freely between users.

Exercise 2
1. F
2. T
3. F
4. F
5. F