The Market System

Date: 2015-10-07; view: 813.

Ex. 9. a) Fill each gap with a suitable word from the box.

b) Sum up the text in 5-7 sentences. Present you summary in class.

The modern market economy is populated by three types of economic agents, whose constitutes economic activity: consumers, producers, and the government. The main social purpose of the economy is to produce goods and services for the satisfaction of the needs and of consumers.

Consumers, typically, represent households that provide labour, and other to produce against an income which they use to purchase consumer goods or to save.

Producers, typically, __ enterprises or firms that acquire of production, or inputs - labour, land, and capital – from households and combine them to produce outputs, or commodities which can be _______ into goods - tangible commodities – and services. The activities of firms move around the sale of their output at a_______.

The third basic element, the government, is involved with the economy, on the one hand, as a producer and consumer and, on the other________ , as a regulator, supervisor and promoter of economic activities.

The economic ____ are engaged in a complex web of transactions involving factors of production and outputs. However, the volume of the commodities that can be produced and _______is limited by the ______ of resources. This fact has two important consequences as regards economic decision-making:

a) the utilization of resources has to be_ . In terms of the welfare of economic agents, the _______of resources is efficient when every opportunity has been exhausted to make some individuals better off without hurting the of others;

b) individual economic agents and society as a whole cannot simply use more, they have to make ________between alternative uses.

Given these constraints, consumers, producers, and the government have to make _________decisions over available resources.

Rational decisions reflect choices that draw maximum ________from given resources or obtain desired results with the ______efforts or cost.