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Variant 1

READING
1. Read the text and decide whether these statements are true or false.

1. Market structure describes how competitive a market is.
2. Perfect competition and pure monopoly are opposites.
3. Four conditions are necessary for perfect competitions to exist.
4. In perfect competition, every company makes a slightly different product.
5. Perfect competition makes it easy for new companies to start trading.
6. When there is perfect competition, companies are able to set any price they
want.

Market structure and competition

When economists talk about market structure they mean the way
companies compete with each other in a particular market. Let’s take the
market for pizzas, for example. There may be many thousands of small
companies all trying to win a share of the pizza market, or there may be only
one huge company that supplies all the pizzas. These are two very different
market structures, but there are many other possible structures. Market
structure is important because it affects price. In some market structures,
companies have more control over price. In other market structures,
consumers have more control over price.
You can think of market structure as a kind of scale. At one end of the
scale is perfect competition and at the other end is pure monopoly. In a
market with perfect competition, there are many companies supplying the
same good or service, but none of them are able to control the price. This
sounds fine, but in reality it is very difficult for such a market structure to
exist. What’s needed?
First of all, there must be many small companies competing. Each
company has its own small share of the market. If one company has a much
larger share than any other, it can affect price, and perfect competition will
no longer exist.
Secondly, products or services from different companies must be the
same. This doesn’t mean that every thing on the market has to be identical,
but they have to be perfect substitutes. In other words, one company’s
product must satisfy the same need as another company’s. Imagine a
company produces a television that also makes tea. Its product is different
from everyone else’s. If it chooses to raise the price of its TVs, customers
may still want to buy them because of this difference.
Thirdly, customers and companies must have perfect and complete
information. This means that they know everything about the products and
prices on the market and that this information is correct.
Fourthly, there mustn’t be any barriers to new companies entering the
market. In other words there must not be anything that helps one company
stay in the market and blocks other from trading.
Finally, every company in the market must have the same access to the
resources and technology they need.
If all of these conditions are met, there is perfect competition. In this
kind of market structure, companies are price takers. This is because the laws
of supply and demand set the price, not the company. How does this work?
Very Simply! An increase in demand will make a company increase its price
in order to cover costs. It might try to push its prices even higher than
necessary so that it can make more profit. However, it will not be able to do
this for very long. The increase in demand and the higher price will make
other companies want to enter the market, too. This will drive the price back
down to equilibrium.
Доп. информация
VOCABULARY

2. Match the words and phrases with the definitions.

1 scale A to have an influence on someone or something
2 supply B the possibility of getting the right to use or look at
something
3 equal C a state of balance
4 affect D looking or being almost, but not exactly, the same
5 substitute E the same in amount, number or size, or the same in
importance
6 access F to provide something that is needed
7 equilibrium G to try to be more successful than someone else
8 demand H a limit or boundary of any kind
9 structure I money which is earned in trade or business
10 barrier J a device for weighing things or people
11 similar K to call for or require something
12 market share L the way in which the parts of a system are
arranged or organized
13 compete M the number of things that a company sells
compared with the number of things of the same
type that other companies sell
14 profit N a thing that is used instead of another thing


3. Choose the best answer A, B or C from the list.

1. Companies usually have a ……. with senior managers at the top and
employees at the bottom.
2. McDonald’s has a very big ……… of the fast food market.
3. Some teachers mark students’ work using a ……. from A to E.
4. No one’s work is ……… we all make mistakes.
5. A perfect economic system may never ……….
6. A ……… monopoly means an absolute or complete monopoly.
7. Not all twins are ……… Some twins are brother and sister, for example.
8. Sometimes a person’s color or race can be ……… to getting work.
9. We use curtains to ……… light.
10. Countries have been …….. with each other for thousands of years.
11. The …….. point is where two things are balanced against each other.
12. Honey is a healthier ……. for sugar to make things sweet.
13. Everyone should have ……. to education.


1 A shape B structure C building
2 A piece B part C market share
3 A scale B point C grade
4 A good B better C perfect
5 A is B live C exist
6 A pure B good C clean
7 A similar B identical C same
8 A gate B barrier C block
9 A barrier B close C block
10 A shopping B trading C selling
11 A equilibrium B middle C equal
12 A difference B addition C substitute
13 A access B openings C entrance
4. Read the text. Use the words given in capitals on the right to form a
word that fits in the gap in the same line.
In a capitalist society, the economy and the state are 1______
separated. Most companies, factories, goods and services are
owned by private firms and individuals rather than the
2_______. In such a society, the government provides only
the 3_______ for the rights of each individual; it does not get
involved in the day-to-day 4_______ of firms and households.
This means that capitalism allows people the 5_______ to
create and accumulate wealth through individual effort.

COMPLETE
GOVERN
PROTECT
RUN
FREE


GRAMMAR

5. Choose the best answer A, B or C from the list to complete the text.
Since the beginning of this year unemployment1 _______ from 2.5 million to
1.8 million, and 2______ below 1.5 million by the end of the year. This
definitely 3 _______ good news for the government as unemployment
4_______ a very important issue in the country at the moment. By the time of
the next election unemployment 5 _______ below I million – it all depends
on the world economy and is impossible to predict with any certainty.
Unfortunately inflation 6 _______ steadily. It 7_______ 6% by the end of
the year. However, the government 8 _______ take panic measures as
inflation is similar to that of its trading partners and 9______ to levels of the
1980s when rates of 30 % or 40 % a year 10 _______ quite common.

6. Translate into Russian.
7. Writing.
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