Контрольная работа по дисциплине «Английский язык»

Text 3: The economic functions of the government

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All real-life economies are «mixed», government and the market system share the function of answering the three fundamental questions. The economic functions of government — federal, state, and local — are of very considerable significance. A variety of regulatory programs designed to protect the environment, improve workers health and safety, protect consumers from unsafe products, provide equal access to employment opportunities, and control the pricing behavior of certain industries impose government into every sector of economic activity. The economic functions of government are varied. Some of them are designed to strengthen and facilitate the operation of the market system. Through the other functions, government modifies the operation of the market system. So, the major functions of the government include:

• providing the legal foundation and social environment conductive to the effective operation of the market system;
• maintaining competition;
• redistributing income and wealth;
• adjusting the allocation of resources so as to alter the composition of the national output;
• stabilizing the economy.

Providing the legal foundation and social environment conductive to the effective operation of the market system.The necessary legal framework involves such things as providing for the legal status of business enterprises, defining the rights of private ownership. Government also establishes legal rules of the game to govern the relationship of business, resource supplies, and consumers with one another. The basic services provided by the government include the use of police powers to maintain order, provision of a system of standards for measuring the weight and quality of products, and establishing of a monetary system to facilitate the exchange of goods and services.

Maintaining competition.Competition is the basic regulatory mechanism. With competition, it is the supply and demand decisions of many sellers and buyers which determine market prices. With competition, buyers are the boss, the market is their agent, and the businesses are their servant. The growth of monopoly alters this situation. Through their ability to determine total supply, monopolists can influence the market in terms of their own self-interest. They charge above-competitive prices which are in direct conflict with the interests of consumer.

Redistribution of income and wealth. The market system is an impersonal mechanism, and the distribution of income to which it gives rise may cause more inequality than society desires. Those who possess valuable capital and land receive large property incomes. But others in our society have no property resources and their incomes are very low. Many of the aged, the physically and mentally handicapped, and husbandless women with dependent children earn only very small incomes or like the unemployed no incomes at all through the market system.

Government is involved in a variety of social insurance and welfare programs designed to ameliorate income inequality in the society. The government carries out redistribution by deliberate policy measures:

• by directing market intervention ( by modifying the prices established by market forces);
• through the transfer payments such as social security and unemployment benefits to individuals (transfer payments are payments for which no current direct economic service is provided in return);
• by imposing taxes (the personal income tax has been used historically to take a larger proportion of the incomes of the rich than of the poor).

Adjusting the allocation of resources so as to alter the composition of the nation output.Government purposely reallocates resources to bring about significant changes in the composition of the economy’s total output. When government taxes a good, such as cigarettes, it generally reduces the quantity of that good produced; when it subsidizes a good, such as milk, it generally increases the quantity of the good produced. By taxing cigarettes, the government can reduce the amount of cigarettes smoked and thereby improve health. The power to tax is thus the power to affect the allocation of the economies resources.

Sometimes markets do not allocate resources efficiently, and government intervention may improve economic performance. Economic theory identifies several types of market failure. One of them involves public goods. Most goods are private goods. A private good, if consumed by one person, cannot be consumed by another. A public good is a good that, even it is consumed by one person, is still available for consumption by others (clean air, national defense, public safety). The government does not have to produce public goods; it only has to specify how much of each should be produced. It may rely on private contractors to do the actual production. On the other hand, there is no general economic reason why government should not produce private goods. There are government-owned firms or nationalized in most countries. Some government enterprises appear successful and efficient.

Stabilizing the economymeans controlling unemployment and inflation and promoting economic growth. Every market economy suffers from business cycle. The business cycle consists of fluctuations of total production, or GDP, accompanied by fluctuations in the level of unemployment and the rate of inflation. The government may reduce taxes in a recession in the hope that people will increase spending and thus raise the GDP. The central bank, which controls the quantity of money, may increase the quantity of money more rapidly in a recession to help bring the economy out of the recession. When inflation is high, the central bank may reduce the rate of money growth with the aim of reducing inflation. These are macroeconomic policies through which the government attempts to stabilize the economy, keeping it close to full employment but with low inflation.

1. Discuss the answers to the questions (orally)
2. Find an appropriate heading for each paragraph of the text
3. Find English equivalents of the following Russian words and word combination
4. Find the definition of the following terms
5. Identify the parts of speech (nouns, adjectives, adverbs, verbs) in the following group of words of the same root. Translate the words into Russian
6. Use the appropriate words from the ex.6 in the sentences below
7. Match the words having the opposite meaning
8. Match the words which are very close in their meaning
9. Fill in the blanks using the words from the box
10. Fill in the missing degrees of comparison
11. Complete the sentences with the comparative or superlative.