| Perfect Competition | Monopolistic Competition | Oligopoly | Monopoly | |
| Numbers of Firms | Many independent firms. None able to control the market. | Many firms providing similar goods and services. | A few large firms providing similar goods and services. | A single large firm. |
| Control Over Price | None. Market determines price. | Influence limited by the availability of substitutes. | Often influenced by «price leader». | Much control. |
| Product Differentiation | None. Products uniform and equal quality. | Products and services differentiated to meet the needs of specific markets. | Significant for some products like automobiles. Little for standardized products like gasoline. | None. |
| Ease of Entry | Relatively easy to enter or leave the market | Relatively easy to enter or leave the market | Difficult. Often requires large capital investment. | Very difficult. |
III. Grammar Exercises
6. Write down the following verbs in the form of Participle II:
to go, to increase, to begin, to buy, to sell, to make, to play, to write, to bring, to specialize, to operate, to understand, to expand.
7. Put the words in brackets in the Passive Voice:
1. Every society (to face) with the identical problem, the problem of scarcity.
2. The need to chose (to impose) on us all by our income, wealth and ability to borrow.
3. Individuals and families (to limit) by the size of their personal income, savings and ability to borrow.
4. In a free market economy, prices (to determine) by the interaction of the forces of supply and demand.
5. When two goods satisfy similar needs, they (to describe) as substitutes.
8. Turn the following from Active Voice into Passive Voice:
1. Profits, savings and borrowing power limit business firms.
2. Frederick Taylor provided a notable impetus to industrial management.
3. Keynes wrote many books.
4. The competitive system will determine business ethics.
5. Great complexity of organization and administration characterize the operation of large business firms.
6. Two or more persons own a business organization.
7. Sir Joseph Binks gives Tom a small cheque.
8. They gave Uncle Tom a cheque and a railway carriage.
9. Translate the following sentences into Russian paying attention to the functions of Participle II:
1. Salaries refer to earnings paid on a weekly or monthly basis.
2. The term «wage» typically refers to the earnings of workers paid by the hour or unit of production.
3. Used in certain ways, wealth can earn income.
4. Natural resources are the things provided by nature that go into the creation of goods and services.
5. Nearly 90 percent of goods and services produced in the U.S. each year come from privately owned firms.
6. Shares are traded in organized markets such as the New York Stock Exchange.
10. Express the following in Russian:
1. The more you know about the subject, the better career decisions you will be able to make.
2. For their part, entrepreneurs seek as much profit as they can extract from their operations.
3. As a rule, the more scarce something is the higher its price will be, and the fewer people will want to buy it.
4. The higher the price, the greater the incentive to produce and sell the product.
11. Form adjectives with the help of suffixes:
-al: economic, nation, production, education, profession.
-able: to change, to exchange, to read, fashion, mistake.
12. Form adverbs with the help of the suffix «-ly»:
economical, political, different, rapid, definite, historical, complete, formal, practical, particular.
13. Read the text and retell the contents in Russian:
William Gates
Gates, William Henry, III (1955- ), American business executive, chairman and chief executive officer of the Microsoft Corporation, born in Seattle, Washington. Gates cofounded Microsoft in 1975 with Paul Allen, his high school friend and partner in computer language development from 1967. Fascinated by computers by the age of 12, Gates had been involved with various programming projects throughout high school. While attending Harvard in 1975, Gates teamed with Allen to develop a version of the BASIC computer programming language for the MITS Altair, the first personal computer. This work on BASIC for the Altair led Gates to drop out of Harvard in 1977 to pursue full-time his vision of «a computer on every desk and in every home,» the idea behind the Microsoft Corporation. In the early 1980’s, Gates led Microsoft’s evolution from a developer of computer programming languages to a diversified computer software company producing computer operating systems and applications software as well as programming tools. This transition began with the introduction of MS-DOS, the operating system for the new IBM Personal Computer in 1981. Gates took a personal role in convincing other computer companies to standardize on MS-DOS, fueling computer industry growth in the 1980’s through software compatibility. Gates also pushed Microsoft toward the introduction of application software such as the Microsoft Word word processing software for the IBM-PC. A key strategic move by Gates was to agree to develop application software for the Apple Macintosh prior to the release of the first Mac in 1984. This led to a strong position for Microsoft in applications that take advantage of the graphical user interface (GUI).
Much of Gates’ success rests on his ability to translate technical visions into market strategy, and to blend creativity with technical acumen. His willingness to bet on new technologies such as Microsoft Windows, Windows NT, and workgroup applications has paid off in keeping Microsoft at the forefront of computer hardware and software evolution.
Unit 6
Grammar: 1. Perfect Tenses.
2. Подчинительные союзы и союзные слова.
3. Побудительные предложения.
I. Language Practice
1. Practise the fluent reading and correct intonation:
Exö cuse me, (please). ö Pardon me. `Sorry to ... (in`trude, inter`rupt, inter`fere). `Look (ö here!) I say... (Say). `Just a ö minute! ö Hi! ö Hey! ø Yes? ø Well? `What ö is it? `What can I ö do for you? `What do you ö want? ø What? ö Sorry! `No `need to be ö sorry. `Sorry to ö trouble (`bother) you! It’s no ö trouble at ö all. Ex`cuse my ö troubling you. `No `trouble at ö `all. I `beg your ö pardon! `No `pardon ö needed! I `beg ö `yours. I `beg your `pardon for `being ö late. `Better ø late than ö `never. I must aöpologize. You ö needn’t. Why ö should you? It’s `nothing to ö speak of. It’s `unforögivable! It’s `unö`pardonable!
2. Listen to the speaker; read and memorize the following words and phrases:
1. to distribute - распределять, размещать
2. to market - продавать, сбывать
3. equipment - оборудование, оснащение
4. to shop - делать покупку в магазине
5. leisure - досуг, свободное время
6. a retailer - розничный торговец
7. overhead(s) - накладные расходы
8. a wholesaler - оптовик, оптовый торговец
9. quantity - количество
10. to bypass - обойти
11. trend - тенденция
12. to call for - предусматривать
13. preselling - реклама до поступления в продажу
14. department store - универсальный магазин
15. discount stores (houses) - магазины учененных товаров
16. chain stores [t•ein] - (амер.) сеть розничных магазинов цепного подчинения
17. ownership - владение, право собственности
18. vending machines - торговые автоматы
Text. Distributing the Product
Some products are marketed most effectively by direct sale from manufacturer to consumer. Among these are durable equipment-for example, computers, office equipment, industrial machinery and consumer specialties such as vacuum cleaners. The direct marketing of products such as cosmetics and household needs is very important.
Direct marketing by mail has been expanded to virtually all types of products and services. Working people find it easy to shop in their leisure hours by catalog because catalogs generally contain extensive product information. For retailers, the use of catalogs makes it possible to do business considerably beyond their usual trading area and with a minimum of overhead. Also important are credit cards, which have made it relatively easy to purchase by mail or telephone even such high-priced items as appliances, electronic equipment, and cameras. At least half the nation’s 50 leading corporations have mail-order divisions.
Television is a potent tool in direct marketing because it facilitates the demonstration of products in use. Also carving its own niche is telephone marketing, called telemarketing, a technique used in selling to businesses as well as to consumers. Most consumer products, however, move from the manufacturer through agents to wholesalers and then to retailers, ultimately reaching the consumer.
Wholesalers distribute goods in large quantities, usually to retailers, for resale. Some retail businesses have grown so large, however, that they have found it more profitable to bypass the wholesaler and deal directly with the manufacturers or their agents. Wholesalers first responded to this trend by adapting their operations so that they moved faster and called for a lower margin of profit.
Retailing has undergone even more change. Intensive preselling by manufacturers and the development of minimum-service operations, for example, self-service in department stores, have drastically changed the retailer’s way of doing business. Supermarkets and discount stores have become commonplace not only for groceries but for products as diversified as medicines and gardening equipment. More recently, warehouse retailing has become a major means of retailing higher-priced consumer goods such as furniture, appliances, and electronic equipment. Chain stores-groups of stores with one ownership-and cooperative groups have also proliferated. Special types of retailing, for example, vending machines and convenience stores, have also developed to fill multiple needs.
II. Exercises on the Text:
3. Give Russian equivalents to:
direct sale from manufacturer to consumer; durable equipment; consumer specialties; household needs; direct marketing by mail; usual trading area; high-priced items; mail-order divisions; also carving its own niche; for resale; to call for a lower margin of profit; to undergo even more change; self-service;have drastically changed; warehouse retailing; higher-priced consumer goods; to fill multiple needs.
4. Compose the questions, using the following words:
1. products, are, what, by direct sale, marketed?
2. it, who, easy, to shop by catalog, finds’?
3. have, what, relatively, it, easy, by mail or telephone, made, to purchase?
4. leading corporations, have, how many, mail-order-divisions?
5. television, why, is, direct marketing, a potent tool, in?
6. is, telemarketing, what?
7. grown, why, so large, some retail business, have?
8. wholesalers, how, to this trend, did, first, respond?
9. undergone, even more change, has, retailing?
10. become, more recently, has, a major means of retailing higher-priced consumer goods, what?
III. Grammar Exercises
Active Voice
| Perfect Tenses | have | ParticipleII(V3) | Time Markers |
| Present Perfect | have (has) | built | ¾´¾¾½¾¾® |
| Past Perfect | had | asked | ¾´¾¾´¾½¾® |
| Future Perfect | shall (will) have | ¾½¾´¾¾´¾® |
5. Read the sentences with adverbs of frequency
| I’ve | never | seen this film. |
| We’ve | just | taken his book. |
| You’ve | often | come here. |
| They’ve | already | done their work. |
| We’ve | not yet | charged a price. |
| Have you | ever | been to the Crimea. |
Read the same in the 3rd person singular.
6. Translate the following sentences paying attention to the different usage of Perfect Tenses:
1. Economic monopolies have existed throughout much of human history.
2. The success of specialized marketing developments has caused many older organizations to revise their operating methods.
3. Keynes’s ideas have profoundly influenced the economic policies of many governments since World War II.
4. The Titanic had already gone down when another ship arrived.
5. Some passengers had been in the icy water for hours when they were saved.
6. When another ship arrived, about 1500 people had already lost their lives.
7. Ecological concerns will have affected product design and marketing.
8. By the end of the year the company will have signed this contract.
9. Who will have finished first?
10. How much will they have won?
7. A manager went away on business. He left of things to be done. He is back now. Arrange a conversation between him and one of his employees. Study the list. Follow the model.
The list of things to be done:
1. Contact the joint-stock company P-A.
2. Send a telex to Lamberton Robotics.
3. Telephone Mr. Green.
4. Sign the contract for the delivery of equipment.
5. Take the customer’s representatives to the plant.
6. Take part in the talks with the British customer.
Model:
A. Have you telephoned Mr. Green?
B. Yes, I have.
A. When did you telephone him?
B. I telephoned him last week.
A. That’s good /fine/ O.K.
Use of the verb «let».
| Our teacher never let us speak Russian at English lessons. | = разрешает |
| Let me (us) do it. Let’s (let us) speak only English. Let them know about it. Let the cat out. | = позвольте = давайте = дайте = выпустите |
| Let them understand their mistakes. Let her speak English. | = пусть |
8. Complete the sentences:
1. Let’s increase...
2. Let me determine...
3. Let me supervise...
4. Let her discuss...
5. Let the wholesalers...
6. Let the small retailers...
9. Translate the following sentences:
1. When he comes to the office he will call the company.
2. We’ll get in touch with them as soon as the goods are delivered.
3. We will clear up the point before he leaves.
4. He couldn’t come to the lecture because he was ill.
5. He walked slowly for he was not in a hurry.
6. As there were no more questions the chairman thanked the reporter for his interesting report.
7. They thought that the bell had rung.
10. Form nouns with the help of the suffixes:
-ant: to emigrate, to dominate, to consult, to participate, to account.
-ese: China, Japan, Sudan.
- ian|-an: statistics, Russia, America, Hungary, Bulgaria, Brazil.
11. Translate English jokes:
A famous Hungarian physicist had just finished reading his scientific paper. It was the first time he had ever made a report in English. After he had finished an American physicist came up to him.
«Say, in what language did you read your paper?»
«Didn’t you understand that?»
«Well, yes, of course. But why did you put in so many English words?»
12. Read the text and retell the contents in Russian
Text. Territorial and Administrative Division of Government in the United Kingdom
In Great Britain the county, or shire, is the principal subdivision of the country for political, administrative, judicial, and other purposes. Counties are used in England and Wales but have been replaced by other administrative units in Scotland and Northern Ireland.
Before the Norman Conquest of the 11th century, the chief unit of local government in England was the shire, which had originated in the Saxon communities of the 5th century. Each shire was ruled by an ealdorman (alderman), but after the 11th century his functions were taken over by the shire-reeve, or sheriff, who was appointed by the king. By the 14th century a county court, composed of several justices of the peace, or magistrates, had developed to help the sheriff administer the county. Over the centuries these crown-appointed magistrates gradually became the primary administrators of counties. Each county also became the constituency for the elections of knights of the shire, or county members of Parliament.
This system of county government, with centrally appointed justices of the peace holding legislative, judicial, and executive powers, became inadequate in the 19th century as the suffrage was extended, government services expanded, and industrial cities continued to grow. To remedy this undemocratic system, the Local Government Act of 1888 established county councils, with members elected by local residents, to take over the legislative and executive duties of the magistrates. The act also replaced the historic counties with new administrative counties, which often had different boundaries. The act also created about 60 county boroughs; these were cities that were given county powers in order to better provide local government services.
The Local Government Act of 1972 reorganized the county system again; 47 new counties contained all urban as well as rural areas in their boundaries, and each county was subdivided into several districts, which numbered almost 300 in all. A British county provides police and fire services, education, social-welfare services, public transport, traffic regulation, consumer protection, libraries, and some highways and parks. The county council is the general governing board of a county; it is a large body, with 50 to 100 popularly elected members, and much of its basic administrative work is delegated to committees.
Outside the United Kingdom, the system of county government was adopted, with variations, in most of the countries settled from Britain. In Canada, however, the county system never became universal; where it exists, the county councils are generally much smaller than in England. New Zealand has had county councils since 1876. In Australia the administrative unit is generally called the shire, though the name county is used for larger areas.
(From the Encyclopaedia)
Unit 7
Grammar: 1. Participle I (Present Participle Active).
2. Continuous Tenses.
3. Безличные предложения с местоимением it.
4. Особые случаи образования множественного числа существительных.
I. Language Practice
1. Practise the fluent reading and correct intonation:
ø Well... `Let me ö see... `Let me ö think... By the ø way... They ø say... ø First. `First of ø all... In `my oøpinion... To `my mind... To `tell the ø truth... I `don’t quite ö follow you. It’s `not to the ö point. `Keep to the ö point. `Generally ø speaking... As `far as I ø know... As to ø me... In ø fact... The matter ø is that... In `any ø case... `Go aöhead. On the ø one hand... On the ø other hand... Above ø all ... Let’s get down to ... To `sum it ø up... `On the ø whole... `All in ø all... `After ø all... In `short... `That exö plains it. Let’s round ö off.
2. Listen to the speaker; read and memorize the following words and phrases:
1. responsibility - ответственность
2. similar - подобный
3. speciality [`spe•clti] - амер. специальность
4. human - человеческий
5. issue - вопрос
6. manufacturing personnel - производственный персонал
7. schedule [`•edju:l] - инвентарь, график
8. raw materials - сырье
9. smoothness - бесперебойность, плавность
10. assets - средства, фонды
11. excessive inventories - чрезмерные запасы
12. sacrificing - недостаточный, убыточный
13. delivery - поставка
14. advantage - преимущество
15. current cost - текущие издержки
Text. Production Management THE "FIVE M'S"
Operations management (known in industry as production management) is a responsibility similar in level and scope to other specialties such as marketing and to human resource and financial management. In manufacturing operations, production management includes responsibility for product and process design, planning and control issues involving capacity and quality, and organization and supervision of the workforce.
Production management's responsibilities are summarized by the "five M's": men, machines, methods, materials, and money. "Men" refers to the human element in operating systems. Since the vast majority of manufacturing personnel work in the physical production of goods, "people management" is one of the production manager's most important responsibilities.
The production manager must also choose the machines and methods of the company, first selecting the equipment and technology to be used in the manufacture of the product or service and then planning and controlling the methods and procedures for their use. The flexibility of the production process and the ability of workers to adapt to equipment and schedules are important issues in this phase of production management.
The production manager's responsibility for materials includes the management of flow processes-both physical (raw materials) and information (paperwork). The smoothness of resource movement and data flow is determined largely by the fundamental choices made in the design of the product and in the process to be used.
The manager's, concern for money is explained by the importance of financing and asset utilization to most manufacturing organizations. A manager who allows excessive inventories to build up or who achieves level production and steady operation by sacrificing good customer service and timely delivery runs the risk that overinvestment or high current costs will wipe out any temporary competitive advantage that might have been obtained.
II. Exercises on the Text:
3. Give English equivalents to:
подобная по уровню и объему; человеческие ресурсы и управление финансовой деятельностью; вопросы, включающие производственные мощности и качество; ответственность за управление произ-водством; подавляющее большинство; «взаимоотношения с людьми»; методы и действия для их использования; гиб-кость производственного процесса; как физические, так и информационные; плавность движения ресурсов и посту-пления данных; временное конкурентное преимущество.
4. Answer the following questions:
1. What is operations management?
2. What does production management include in manufacturing operations?
3. What are the «five M’s»?
4. Why is «people management» one of the production manager’s most important responsibilities?
5. How must the production manager choose the machines and methods of the company?
6. In what phase of production management the flexibility of the production process is an important issue?
7. What does the production manager’s responsibility for materials include?
8. How is the manager’s concern for money explained?
9. What manager runs the risk?
10. Will high current costs wipe out any temporary competitive advantage?
III. Grammar Exercises
| ing — forms | |||||||
| noun | adjective | gerund | participle I | ||||
| (pricing) | (managing) | (delivering) | (smb. working) | ||||
Active Voice
| Continuous Tenses (Progressive) | be | Participle I (verb + ing) | Time Markers |
| Present Continuous | am, is, are | building | ¾¾¾Ì½É¾¾¾® |
| Past Continuous | was, were | asking | ¾Ä¾¾½¾¾® ¾8¾½¾® |
| Future Continuous | shall (will) be | ¾¾¾½¾¾Ä® ¾8¾½¾® |
5. Write down the following verbs in the form of Participle I.
1. to manage, to know, to include, to involve, to refer, to operate, to work, to select, to control, to plan, to determine, to explain, to finance, to get, to study, to write, to persuade, to increase, to die.
6. Translate the following sentences into Russian paying attention to the functions of Participle I:
1. Marketing concentrates primarily on the buyers, or consumers, determining their needs and desires, educating them, developing strategies to persuade them to buy.
2. For retailers, the use of catalogs makes it possible to do business considerably beyond their usual trading area.
3. The whole month I was working hard. We were auditing accounts of a joint venture.
4. The State Tax Service in Russia is a new organization but its role is becoming very important because more and more new businesses are appearing in the country.
5. The majority of corporations are small, differing little in their characteristics from other forms of business.
6. An Italian delegation arrived yesterday. At 9 we were meeting the delegation at the airport, at 12 we were having lunch, at 2 we were discussing the contract.
7. Those who interpret the voting incorrectly, producing too much or too little, or charging a price that is too low, do not earn profits.
8. At least half the nation’s 50 leading corporations have mail-order divisions.
9. You phoned at 9.15, didn’t you? We were discussing our business plan at that time.
10. Also carving its own niche is telephone marketing.
sunny rainy frosty cloudy
and hot and foggy and snowy and windy
7. Look at the pictures. Ask and answer the question as in the model:
Model: A. What’s the weather like today?
B. It’s hot and dry.
8. Read the dialogue and make up your own dialogue:
A. Look, Ann, is it cold outside?
B. I think it’s not cold. It’s warm.
A. What’s the temperature today?
B. It’s 4 below zero.
A. Let’s go to the scating-ring.
B. I’m sorry, I’m busy.
A. What a pity!
Образование множественного числа существительных греческого и латинского происхождения.
| Единственное число | Множественное число | |
| datum[`deitcm] | данная величина | data [`deitc] |
| addendum[c`dendcm] | добавление | addenda [c`dendc] |
| erratum[i`reitcm] | ошибка (опечатка) | errata [i`reitc] |
| memorandum [memc`r ndcm] | меморандум | memoranda [memc`r ndc] |
| phenomenon[fi`n]mincn] | явление | phenomena [fi`n]minc] |
| criterion[krai`ticricn] | критерий | criteria [krai`ticric] |
| basis[`beisis] | базис | bases [`beisi:z] |
| crisis[`kraisis] | кризис | crises [`kraisi:z] |
| analysis[c`n lisis] | анализ | analyses [c`n lisi:z] |
| thesis[`›i:sis] | диссертация | theses [`›i:si:z] |
| stimulus[`stimjulcs] | стимул | stimuli [`stimjulai] |
| index[`indcks] | индекс, | indexes [`indckscs] |
| указатель | indices [`indisi:z] | |
| apparatus[cpc`reitcs] | аппарат | apparatus [cpc`reitcs] |
9. Read the text and retell it in Russian:
Science and Technology in Britain
Since the first artificial splitting of the atom at Cambridge, in 1932, by Sir John Cockcroft and Dr. E. T. S. Walton, Britain's nuclear scientists have made continuous progress in harnessing atomic energy. Today eight commercial nuclear power stations are supplying electricity for factories and homes and others are being built. Some of Britain's top scientists are engaged in space research on projects such as upper atmosphere probes with British-built rockets at Woomera, Australia, and inwork on satellite communications. Others are making vital discoveries in the laboratory into the very nature of life itself.
Britain is pre-eminent in radio astronomy and in many fields of electronics including miniaturisation. one of the most important factors in the electronics revolution, and in radar for marine and aviation purposes. Much basic work was done in Britain on electronic computers. British advances in medicine include penicillin and other antibiotics, such as cephalosporins, heart-lung machines, a new anti-viral agent, Interferon, of great potential value and many other important developments in the treatment of disease.
British contributions to science include many great discoveries linked with famous names - Sir Isaac Newton (theory of gravitation), Robert Boyle ("the father of modern chemistry"), Michael Faraday (whose discoveries gave rise to the electrical industry), and Henry Cavendish (properties of hydrogen). In the present century - J. J. Thomson, Lord Rutherford and Sir James Chadwick (basic work on nuclear science), Gowland Hopkins (the existence of vitamins), Sir William Bragg (X-ray analysis), and many others. Medicine owes much to such pioneers as William Harvey (circulation of the blood), Edward Jenner (vaccination), Joseph Lister (antiseptics). Sir Ronald Ross (who proved the relation between malaria and mosquitoes).
Since 1945 there have been 27 British scientists who have received international recognition for their work by gaining Nobel awards. There are over 200 learned scientific societies in Britain. In ten years Britain has doubled her total number of qualified scientists.
10. Translate English jokes:
Which of You Three?
A. - Hallo? Is that Ted Wells?
B. - Yes. Who is speaking?
A. - Sam.
B. - Who? I don’t hear.
A. - I say Sam: Sid, Ada, Mary. Do you hear?
B. - Yes, I do. But which of three is speaking?
¾ T T T ¾
Mother: Well, what is Mary doing?
Jane: Well, if the ice is as thick as she thinks, she is skating, but if the ice is as thin as I think, she is swimming.
Unit 8
Grammar: 1. Правила согласования времен. Косвенная речь.
2. Future-in-the-Past.
3. Бессоюзные определительные предложения.
4. This-these, that-those как заменители ранее стоящего существительного.
I. Language Practice
1. Practise the fluent reading and correct intonation:
`Are you `going to the ø shop?
ö Yes, I ö am. ö No, I am ö not.
`Are you `waiting for a ø taxi or for a ö bus.
I am `waiting for a ö bus.
`What are you ö doing?
I am `reading a ö magazine.
`What `magazine are you ö reading?
I am `reading an `English ö magazine.
`Where are you ö going?
I am `going to the ö theatre.
`Who is `going to the theatre ö with you?
My `friend ö is.
`Why are you sitting ö here?
I’m `sitting ö because I’m ö tired.
`What were you `doing when I `came ö in?
I was `looking for my `new ö slides.
2. Listen to the speaker; read and memorize the following words and phrases:
1. hardware store - магазин скобяных товаров
2. sophomore [`s]fcm]:] - студент-второкурсник
3. stock - склад
4. job market - рынок труда
5. supervisor - контролер
6. employee [/empl]i`i:] - служащий
7. inventory - инвентаризация
8. skill - умение, практический опыт
9. to hint - намекать
10. establish - основывать
11. loan - кредит
12. labor coast - издержки на оплату рабочей силы
13. in the long run - впоследствии
14. promotion - продвижение по службе
15. incentive - стимул
Text A. How Competition Benefits Us All.
In a competitive market, producers constantly strive to reduce their production costs as a way to increase profits. The increased efficiency that allows them to reduce their costs also enables producers to sell their goods at a lower price. Thus, by promoting efficiency, competition leads to lower prices.
Competition also motivates producers to improve the quality and increase the variety of goods and services. Consumers soon learn which brand offers the best value, and that firm will earn greater profits than its competitors. Similarly, producers in a competitive market must constantly look for new and attractive goods and services to win a larger share of the market.
As firms compete for consumer’s dollar in a market, their efforts lead to the production of a variety of better-quality products at the lowest possible prices. And since we are all consumers, it follows that competition benefits us all.
Text B. Competition in Many Markets: An Example.
On weekends during the school year and in the summer, David Scott works in a small local hardware store. When he began his job, as a sophomore, he was a stock clerk, and he thought himself lucky to have any job. Each year there had been a lot of competition for jobs in his city, especially in May and June when college students entered the local job market. In the spring of his senior year David decided to be more selective about where he worked and how much he earned. He decided to ask his boss for a raise to become a supervisor of the younger employees at the store.
He told his boss that since he learned the computer-assisted inventory and ordering system and other special skills he was more valuable, and should be paid accordingly. He hinted that he might seek employment elsewhere. Another store in town was advertising for someone with his skills.
David’s boss, Jay Richards, the entrepreneur who had established the small hardware store two years earlier, faced competition every day. Since starting his business, he had been in competition with other buyers and sellers in the marketplace. He competed with other buyers when he purchased the land for his store. He competed with other borrowers when he applied for his bank loan. He competed every week for the best deals on the goods he bought from his wholesalers. Jay knew that he also had to compete for customers with other hardware stores.
One of his major expenses was labor. He had to keep his labor costs down to meet his other expenses and earn a profit. He knew that David would cost him more, but he decided to pay him the higher wage because David had acquired skills that made him more productive. Jay reasoned that David’s experience and knowledge would help the business to save money in the long run.
Supply and Demand.
David was also free to sell his labor somewhere else. He could have competed with others for another job. From the newspaper ad he knew at least one other job was available. Maybe there were others. He wasn’t sure. He also wasn’t sure about the supply of other workers with his skills. He wondered whether he would get the raise and promotion if there were lots of people who could do the job.
David’s boss was also free to interview and hire other workers. In their own ways David and Jay were both trying to get what each thought would be best. They were competing.
Дата: 2019-07-31, просмотров: 262.
