7.4. BUSINESS

7.4. BUSINESS

7.4.1

Listening

You will hear an interview with a woman who

started a business with her husband. Tick

the feelings she mentions they have or had.

envy of other people
acceptance that they might not be offered jobs by employers again
insecurity about their present position
admiration for people who start businesses
confidence in having greater abilities than others
interest in making money
unhappiness in their former jobs
nervousness when starting their business
boredom that is brought on very easily
desire to start a different business

Comprehension

Listen to the interview again and say

whether the following opinions and

attitudes were stated there.

She would like to be in someone else’s position from time to time.
She would sometimes prefer to work for someone else again.
She has acquired a high opinion of herself.
Her attitude might not appeal to employers.
She fears that her business might fail.
Some people can’t do anything other than work for themselves.
Deciding to work for yourself takes courage.
Not getting on with others at work makes people work for themselves.
Not wanting to obey orders at work makes people want to work for themselves.
Failing to get promotion can make you decide to work for yourself.
Believing that others don’t do work as well as you are capable of can lead you to work for yourself.
She doesn’t care about money.
They didn’t enjoy their previous work.
They enjoyed being in a large company.
They sought advice on what kind of business to start.
They were already familiar with how certain kinds of business were run.
They knew the business would succeed when they started it.
They like doing things that are not easy to do.
They don’t like to have a routine existence.
They are losing interest in their current business.

7.4.2

Vocabulary

Read the notes and learn the words and

expressions that you can use in economic

and financial discussions.

An A to Z of Economics: A Layman’s Guide

A is for automation: bringing widespread, full-scale unemployment as the need for manual labour decreases.

B is for balance of payments: the discrepancy between the amount of money paid for imports and the amount of money received for exports.

C is for cost of living index: the system of measuring the annual rate of inflation. An index-linked pension scheme is not a bad thing to have on your side.

D is for devaluation: (The last resort? A panic measure?) an attempt, by reducing the value of one’s currency, to increase the volume of exports compared to imports.

E is for expansionist policy: reflationary, pumping money into the economy, boosting investment and employment.

F is for fiscal matters: anything to do with the Treasury, particularly its revenue, especially through taxation.

G is for GNP or gross national product: the sum total of the money earned through a nation’s goods and services.

H is for health, hospitals, housing: three outlets for government expenditure on public services. Other large items of public expenditure include defence, roads and communications, industry and trade, environmental services and social security benefits.

I is for interest rates: a weapon in the Government’s armoury, used to deflate, stimulate or stabilize the economy.

J is for jobs: a key ball in the economist’s juggling act. Are full employment and a low inflation rate mutually exclusive?

The labour force in Britain can be divided into three categories:

1. primary industries (agriculture, fishing, mining, quarrying, forestry)

2. production industries (construction, gas, electricity, water, transport and manufacturing, etc.)

3. services (distributive trades, financial, business, professional and scientific, catering and tourism, national and local government).

K is for key industries: those essential to the economic welfare of a nation, such as oil in OPEC countries, precision engineering in Germany, grain in Canada, textiles in South East Asia, electronic goods in Japan.

L is for liquidity: gold and foreign exchange reserves are known as international liquidity, supervised to some extent by the IMF (International Monetary Fund).

M is for monetarism: Professor Milton Friedman’s brainchild, concentrating on the control of money supply to conquer inflation.

N is for nationalized industries: state-owned corporations, struggling in Britain to break even and cover their costs, often having to be propped up by the Exchequer. Though often natural monopolies, they sometimes face competition from the private sector. During the eighties, several nationalized industries in Britain were privatized.

O is for output: the output per employee multiplied by the number of employees gives a company or a nation’s productivity. Britain’s low rate of increase in this respect (often hardly any growth) used to be blamed on many things: poor industrial relations, the Common Market (EEC), world recession, and, most of all, on old capital equipment that the too slowly expanding workforce had to use. There was some improvement in the eighties, however.

P is for protectionism: a policy restricting free trade, encouraging the purchase of domestic product by imposing some form of import control or duty (tariffs).

Q is for import quotas: import restrictions. This is one way to reduce the deficit on current account, and regulating the volume of imports allowed in.

R is for pay restraint: some kind of incomes policy attempting to limit the size of wage increases or, in a wage freeze, to stop them completely. Which is fairer: a percentage increase across the board or a fixed sum for everyone?

S is for the Stock Exchange: the source of most long-term credit in Britain, as it is the centre for buying and selling of stocks and shares. Some of these are fixed interest loans with dividends, some are gilt-edged securities. This can be a risky way to save if there is a stock market crash.

T is for taxation: the Government’s main means of regulating its budget. Direct taxation concerns people’s income; indirect taxes are levied on goods and services.

U for unemployment: the overmanning of a plant, the result of restrictive labour practices still common today. Higher efficiency means fewer jobs.

V is for visible trade, as opposed to invisible trade. Visible exports are goods; invisible exports are services which are the basis of an international transaction.

W is for: Why bother about X, Y and Z?

7.4.3

Practice

Match the opposites or related words

from the left and right columns.

1. (the) boardroom

2. boom

3. borrowing

4. buying

5. credit

6. management

7. net

8. (the) private sector

9. profit

10. supply

11. revenue

12. skilled labour

13. state-owned industry

14. stocks

15. take on new staff

16. wholesal

a. debit

b. demand

c. expenditure

d. gross

e. lay off staff, make staff redundant

f. lending

g. loss

h. private enterprise

i. (the) public sector

j. retail

k. selling

l. shares

m. (the) shop floor

n. slump, recession

o. unskilled (or semi-skilled) labour

p. workers, employees, staff

Speaking

Speak about the economic situation in

Belarus using the words from the Guide

7.4.4

Discussion

Answer the following questions explaining

your point of view.

What are some of the good and bad aspects of advertising: on the screen, on paper and in the street?
If you were an investment expert, what advice would you give to your client who might invest $100.000 redundancy money?
How can the government (either local or central) help to handle economic problems of big and small business?
An expert economist is giving a talk in your town this evening. What questions would you like to ask him?
Note 5 things you have never really understood about economics.

7.4.5

Word Use

Note down the day-to-day business that is referred

to in the diary below. You know there is going

to be another meeting at 10.00. Rearrange the

working day, leaving one hour for lunch.

A Businessman or Businesswoman’s Day

Monday 24 October
O9.00	In tray / Out tray; Dictate correspondence. Memo to staff re salary Negotiations for next year. Replies to Zurich re Consumer Association conference
10.00	Discuss finishing touches to next year’s brochures with HJ from Advertising agency
11.00	See Managing Director: check VAT figures with head of Accounts Department
12.00	Meeting with Van Braun re Amsterdam deal. N.B. Phone bank re delay on bridging loan for new plant transactions
13.00	Working lunch with Chief Buyer from Swan & Sons (J.White) (take catalogues, etc. and file)
14.00
15.00	Conference with Marketing Division Executives (raise questions on expense accounts for Sept.) Telex Tokyo customers re latest order.
16.00	Interview applicants for position of Personal Secretary – Miss Johnson, Ms Greer. Issue Press Statement denying rumours of merger with J & J
17.00	Rocket for Smythe re disappointing sales figures – have ready latest balance sheets plus competitors’ recent results: circular for all other sales reps.
18.00	Emergency Board Meeting on takeover bid by James & James – prepare agenda
19.30	Shareholders’ annual cocktail party
20.00

7.4.6

Idiom

Read the dialogue and try to explain

the idioms in bold.

Charles: So James, how’s the business doing?

James: Not so good, old boy! I’ve been having problems with old Rumpton. I’m afraid I’m going to have to 1) give him the boot.

Charles: Rumpton! But he’s been running the factory for years!

James: Yes Charles, I know, but he’d getting on a bit you know. He’s sixty-two and, quite frankly, I don’t think he knows what he’s doing any more. He seems to have turned into 2) a lame duck in recent years – no control over the workforce and, well, between you and me, the company’s 3) feeling the pinch. You know our profits are down twenty per cent since last year.

Charles: Goodness me! You’re not 4) in the red, are you?

James: Certainly not! We haven’t 5) hit rock bottom just yet! No, we don’t owe anyone anything. We’re still 6) in the black – for now, at least.

Charles: Well, it sounds like you’re 7) playing with fire if you keep him for much longer! You definitely need to get somebody else to 8) step into his shoes.

James: Yes, but who? I need somebody who’s going to run the place with 9) a firm hand – not take any nonsense, you know?

Charles: Yes, quite. Do be careful though, old chap. A nasty decision won’t 10) pay dividends, believe me!

Definition

Match the items with the idioms from part A.

a. in debt

b. in credit / making profit

c. to replace somebody

d. to reach the lowest point

e. to suffer because of lack of

money

f. a person / company that is weak /

a failure

g. to bring advantages at a later date

h. control and discipline

i. to take dangerous risks

j. to fire somebody from their job

Practice

Fill in the gaps with phrases from part A.

You should stop spending so much money or you’ll be … before you know it!
There are very few problems at this school as the headmaster governs the students with … .

Tom’s new business turned out to be … and he lost a lot of money.
Gayle felt relieved when she put her wages into the bank as she was finally … again.
You are … if you quit your job before finding another one.

Check Yourself

Fill in the verbs to complete the idioms.

Make up your own sentences with them.

1. to … rock bottom

2. to … the pinch

3. to … dividends

4. to … somebody the boot

5. to … into somebody’s shoes

7.4.7

Idiom

Read the extract from a story and try

to explain the idioms in bold.

‘What? Another loan? No way, Kim. I’ve already given you 1) a small fortune!’ Kim shuddered as she knew her father 2) meant business this time; she could hear it in his voice.

‘But, Dad … Please! Just until I 3) get the company off the ground. Once I get some orders I’ll be fine … Honest!’ She was desperate. Unless her father helped her out, her new clothing company would never get the chance to 4) bear fruit. ‘I’m 5) living on a shoestring already; all I get is my income support!’ She could hear her father trying to interrupt, but she went on, ‘Listen, I’ve been 6) burning the midnight oil this month and I’m exhausted, but I’ve figured out that just another thousand should do it. You’ll see!’

‘I said no, Kim,’ her father stated sternly. ‘You seem to think that I 7) am rolling in it, but I’m not – I work hard to earn the little that I do, and to be honest, I’m not sure if I’ll be able to 8) keep my head above water if I keep lending you money.’ Kim fought back a sob. She couldn’t believe that he would let her down.

‘I’m begging you, Dad. It won’t be 9) money down the drain. Just give me a chance to show you! You’ll get it all back with interest!’ Kim waited nervously for her father’s reply. Eventually, he answered.

‘Alright love. But this is the last time. I hope that you realize that your mother and I are really going to have to 10) tighten our belts though.’

Definition

Match the items with the idioms from part A.

a. to manage with very little money

b. to live on a smaller budget

c. to be serious about what one says / intends

d. to work very late at night to achieve something

e. a lot of money

f. money wasted

g. to survive despite financial problems

h. to produce good results

i. to be rich

j. to start a business / company / project, etc.

Rephrase

Reword the sentences using the words in

brackets. Do not change these words

in any way.

During the economic crisis, even the royal family had to spend less money than usual. (belts)
Money is so scarce at the moment that I have had to take a second job just to survive. (water)
I knew that Ray had been working late as he looked exhausted. (oil)
I knew that Mrs Watkin was serious when I got a letter from her lawyer. (business)
It costs a lot of money to start a business. (ground)

Practice

Fill in the phrases from part A.

Peter: Susan, I have the most wonderful news!

Susan: What is it? What’s happened?

Peter: All the hard work we put into our formula is about to 1) … . Someone wants to market it. We’ll be rich. We won’t have to 2) … any more.

Susan: That’s wonderful, darling. I knew that it wasn’t 3) … when we put all our savings into improving the formula. It’ll earn us 4) … .

Peter: You are right, dear. Let’s go out and celebrate. After all, soon we’ll be 5) … .

7.4.8

Check Yourself

Fill in the blanks with phrases from

exercises 7.4.6 and 7.4.7.

With what little money I have from my savings, I can barely keep my … .
The rent on Vicky’s new flat is very high, so she’ll have to … from now on.
The long hours and hard work we put into the new company are finally beginning to … .
Ross is such an irresponsible employee; I wouldn’t be surprised if he is … soon.
Arthur’s off sick for a few months. So, Jenny, you’ll have to … .
Nora’s … as a secretary. She can’t do the job and is an expense to the company.
The company … after all the investors suddenly pulled out.
We’ve been … all winter so that we can afford to get married in August.
The public realized that the new government … as soon as it raised the nation’s taxes.
You could ask your boss to buy you a new company car; after all he’s … .

Rephrase

Reword the sentences using the words in

brackets. Do not change these words.

It’s a good idea to take out a small loan to help start your business. (ground)
For the first time in years, IHD industries is making a profit. (black)
Young offenders need strict guidance to help them reform. (firm)
You’ll have to work late tonight in order to finish the project. (midnight)
People have been suffering financially since the government raised taxes. (pinch)
The company’s investment in computer design is now producing good results. (fruit)
Money spent on the National Lottery is just money wasted. (drain)
If you’re in debt, you should get another job. (red)
My family lost a huge amount of money in the stock market crash of 1929. (fortune)
You’re taking a big risk if you borrow money to buy stocks and shares. (fire)

Correction

Find mistakes in the use of the idioms.

Replace the incorrect idioms with a

suitable alternative.

She was given the boot last week and now she has to find another job.
I’m afraid you’re in the black again, Mr Jones – you owe the bank $500.
Helen was a lame duck when she sold her property at a great profit.
Many students live on a shoestring while they are at university.
In my opinion, buying a second-hand car is just money down the drain.
Our company finally started to hit rock bottom after its fourth year in business and we paid off our loan.
After Anna’s father retired, she stepped into his shoes and became the director of the family business.
I knew my rival tightened his belt when I received a call from his lawyer.
You’ve been playing with fire again, haven’t you? You haven’t stopped yawning all morning.
We really felt the pinch after spending so much money on our new house.

7.4.9

Translation

Translate the extracts. Make up 2-3

sentences to continue each passage.

1. Direct and indirect taxes require the average citizen to work from January until the middle of July to pay for the government. Then working men and women begin to labour for themselves.

2. He was weary of working late, paying high office rents, trying to stay afloat in a system that values money more than people.

3. The painter’s family would have been better off holding onto some of the art, because prices have continued to climb all these years. His son ended up with 15 million after taxes. Unless he lives high on the hog, that ought to have grown into an even more substantial fortune.

4. You are getting more sociable every day. If I didn’t know better, I’d think you’ve been raiding my cash supply to pay for some high-priced Beverly Hills therapist.

5. Never stole a dime in my life. Never cheated on my taxes. Never cheated on my wife. Paid back every loan I ever took. Worked overtime most weeks since I’ve been a cop. Walked straight and narrow – and let me tell you, it hasn’t always been easy. Sometimes I get tired, fed up, tempted to take an easier way. I’ve had bribe money in my hand, and it felt good, but I just couldn’t make my hand put it in my pocket.

7.4.10

Speaking

Scan the text and answer the questions below,

expressing your opinion on the matter of taxation.

Everyone knows that taxation is necessary in a modern state: without it, it would not be possible to pay the soldiers and policemen who protect us; nor the workers in government offices who look after our health, our food, our water, and all the other things that we cannot do for ourselves, nor also the ministers and members of parliament who govern the country for us. By means of taxation we pay for things that we need just as much as we need somewhere to live and something to eat.

But though everyone knows that taxation is necessary, different people have different ideas about how taxation should be arranged. Should each person have to pay a certain amount of money to the government each year? Or should there be a tax on things that people buy and sell? If the first kind of taxation is used, should everyone pay the same tax, whether he is rich or poor? If the second kind of taxation is preferred, should everything be taxed equally?

In most countries, a direct tax on persons, which is called income tax exists. It is arranged in such a way, that the poorest people pay nothing, and the percentage of tax grows greater as the taxpayer’s income grows.

But countries with direct taxation nearly always have indirect taxation, too. Many things imported into the country have to pay taxes or ‘duties’. Of course, it is the men and women who buy these imported things in the shops who really have to pay the duties, in the form of higher prices. In some countries, too, there is a tax on things sold in the shops. If the most necessary things are taxed, a lot of money is collected, but the poor people suffer most. If unnecessary things like jewels and fur coats are taxed, less money is obtained, but the tax is fairer, as the rich pay it.

Probably this last kind of indirect tax, together with a direct tax on incomes which is low for the poor and high for the rich, is the best arrangement.

What would the society be like without taxation?
Do you agree that duties should be levied on all imported goods? If no, what imports should be free of taxation?
Is it fair that unnecessary goods are taxed? What goods can be considered unnecessary?
Should everyone pay the same tax irrespective of their income?
What part of our income do we pay in taxes?
If you were the head of government, what system of taxation would you impose?

7.4.11

Writing

Develop an idea of a business you would

like to start. Take into consideration

the following aspects:

the kind of business; its prospects
organization and staff
working regulations and duties
advertising campaigns
taxation and expected profits