THE subjective Participle complex

is used with the verbs denoting sense perceptions:

to see to hear to watch to notice to consider

She was seen walking along the street.. Two people were heard quarelling. They were watched playing in the garden. He was noticed entering the office. The work was considered finished.

THE absolute Participle complex

The rain having stopped, we went home. The day being fine, she went for a walk. Time permitting, we’ll go to the forest.

In this complex Participle has its own subject expressed by a noun in the Common Case or a personal pronoun in the Nominative case.

Functions	Examples
Complex Subject (The Subjective Participle complex)	They were heard speaking in a lively manner. He was seen surrounded by a group of students. He was noticed entering the library.
Complex Object (The Objective Participle complex)	I saw the workers packing the goods. They watched the car being repaired. They want the goods shipped on Monday.
Attribute	The cars being produced at our plant are very good.
Adverbial Modifier	Walking in the park, he met his old friend.
The Absolute Participle complex	The letter being written, I went to post it. He being tired, I decided not to disturb him.

The Gerund. Forms and Functions

Gerund	Active	Passive	Uses
Indefinite	reading	being read	The action expressed by the gerund: a) is simultaneous with that expressed by the finite verb. b) doesn’t refer to any particular time.
She likes reading. She likes being read.
Perfect	having read	having been read	The action expressed by the gerund precedes that expressed by the finite verb.
Thank you for having helped me. I remember having been asked this question.

Functions	Examples
Subject	Reading books is useful. Smoking is harmful. Reading love stories made her cry.
Predicative	His hobby is collecting stamps. The main thing is getting there in time. Seeing is believing.
Part of a Compound Verbal Predicate	She went on reading. She stopped smoking.
Direct Object	I couldn’t avoid speaking to her. The film is worth seeing. I don’t mind waiting.
Prepositional Object	I am fond of reading. He insisted on doing the work himself. I don’t like his habit of making people wait.
Attribute	All liked the idea of going to the country. I have no intention of discussing this question. There are different ways of solving this problem.
Adverbial Modifier	On entering the room he came up to me. He left the room without saying a word. Excuse me for being so late.

REFERENCE LIST OF VERBS FOLLOWED BY GERUNDS

1. admit 2. advise 3. anticipate 4. appreciate 5. avoid 6. complete 7. consider 8. delay 9. deny 10. discuss 11. dislike 12. enjoy 13. finish 14. forget 15. can’t help 16. keep 17. mention 18. mind 19. miss 20. postpone 21. practise 22. quit 23. recall 24. recollect 25. recommend 26. regret 27. remember 28. resent 29. resist 30. risk 31. stop 32. suggest 33. tolerate 34. understand

He admitted stealing the money. She advised waiting until tomorrow. I anticipate having a good time on vacation. I appreciated hearing from them. He avoided answering my question. I finally completed writing my term paper. I will consider going with you. He delayed leaving for school. She denied committing the crime. They discussed opening a new business. I dislike driving long distances. We enjoyed visiting them. She finished studying about ten. I’ llnever forget visiting Napoleon’s tomb. I can’t help worrying about it. I keep hoping he will come. She mentioned going to the cinema. Would you mind helping me with this? I miss being with my family. Let’s postpone leaving until tomorrow. The athlete practised throwing the ball. He quitted trying to solve the problem. I don’t recall meeting him before. I don’t recollect meeting him before. She recommended seeing the show. I regret telling him my secret. I can remember meeting him when I was a child. I resent her interfering in my business. I couldn’t resist eating the dessert. She risks losing all of her money. She stopped going to classes when she got sick. She suggested going to the cinema. She won’t tolerate cheating during an examination. I don’t understand his leaving school.

The Gerundial complex

The Gerundial Complex consists of a noun (in the Common or Possessive Case) or a possessive pronoun and the gerund.
Functions	Examples
Complex Subject	Your coming here is very desirable. It’s no use my telling you a lie.
Predicative	What annoys me is his being careless.
Direct Object	I don’t like his reading aloud. Forgive my saying it.
Prepositional Object	I insist on your doing it. Everything depends on your getting there in time.
Attribute	Everyone liked the idea of his joining us. I don’t know the reason of your leaving.
Adverbial Modifier	He entered the room without his seeing it.

Conditional sentences

Type of condition	if-clause	main clause	Examples
Type IReal condition (refers to the future)	Present Indefinite	Future Indefinite can + Infinitive	If I have enough money, I will/ can buy a car.
Type II Unreal condition (refers to the present or future)	Present Subjunctive II (Past Indefinite)	would/could + Infinitive	If I had enough money, I would/could buy a car
Type III Unreal condition (refers to the past)	Past Subjunctive II (Past Perfect)	would/could have + Past Participle	If I had had enough money, I would/could have bought a car.

Irregular VerBs

Infinitive	Past Indefinite	Past Participle
abide arise awake be bear beat become befall beget begin behold bend bereave beseech beset bet bid bind bite bleed bless blow break breed bring broadcast build burn burst buy cast catch choose cleave cling	терпіти виникати будити бути нести; народжувати бити ставати траплятися виробляти починати помічати згинати(ся) втрачати благати, просити оточувати битися об заклад пропонувати ціну зв’язувати кусати(ся) кровоточити благословляти дути ламати(ся) розводити приносити передавати по радіо будувати палити, горіти спалахнути купувати кидати, скидати ловити вибирати розколювати(ся) чіплятися	abode, abided arose awoke was, were bore beat became befell begot began beheld bent bereaved, bereft besought beset bet, betted bade, bid bound bit bled blessed, blest blew broke bred brought broadcast (-ed) built burnt, burned burst bought cast caught chose clove, cleft clung	abode, abided arisen awaked, awoke been borne, born beaten become befallen begotten begun beheld bent, bended bereaved, bereft besought beset bet, betted bidden, bid bound bitten, bit bled blessed, blest blown broken (broke) bred brought broadcast (-ed) built burnt, burned burst bought cast caught chosen cloven, cleft clung
clothe come cost creep cut dare deal dig do draw dream drink drive dwell eat fall feed feel fight find flee fling fly forbid forecast forego foresee foretell forget forgive forsake freeze get gild give go grind	вдягати приходити коштувати повзти, повзати різати сміти; наважуватися займатися копати; рити робити тягти; малювати мріяти пити водити; їхати жити; мешкати їсти падати годувати відчувати битися знаходити тікати; уникати кидати(ся) літати забороняти передбачати передувати передбачати провіщати забувати прощати залишати; покидати морозити отримувати золотити давати ходити точити; шліфувати	clothed (clad) came cost crept cut dared (durst) dealt dug did drew dreamed, dreamt drank drove dwelt ate fell fed felt fought found fled flung flew forbade, forbad forecast, forecasted forewent foresaw foretold foregot forgave forsook froze got gilded, gilt gave went ground	clothed (clad) come cost crept cut dared dealt dug done drawn dreamed, dreamt drunk driven dwelt eaten fallen fed felt fought found fled flung flown forbidden forecast, forecasted foregone foreseen foretold foregotten forgiven forsaken frozen got, gotten gilded given gone ground

 

grow hang have hear heave hew hide hit hold hurt keep knit know lade lay lead lean leap learn leave lend let lie light lose make mean meet melt mislay mislead mistake mow outdo outgrow overbear overcast	рости вішати мати чути піднімати рубати ховати(ся) ударяти тримати завдавати болю тримати в’язати; плести знати навантажувати класти; накривати вести нахиляти(ся) стрибати вивчати залишати позичати дозволяти лежати запалювати(ся) втрачати робити означати зустрічати танути загубити вводити в оману помилятися косити перевершувати переростати перемагати хмаритися	grew hung, hanged had heard heaved, hove hewed, hid hid hit held hurt kept knitted, knit knew laded laid led leant, leaned leapt, leaped learnt, learned left lent let lay lighted, lit lost made meant met melted mislaid misled mistook mowed outdid outgrew overbore overcast	grown hung, hanged had heard heaved, hove hewed, hewn hidden, hid hit held hurt kept knitted, knit known laden laid led leant, leaned leapt, leaped learnt, learned left lent let lain lighted, lit lost made meant met melted, molten mislaid misled mistaken mowen outdone outgrown oveborne overcast

 

overcome overdo overdraw overhear overtake overthrow partake pay put read rebuild relay rend retell rid ride ring rise run saw say see seek sell send set sew shake shear shed shine shoe shoot show shut sing sink sit	перемогти перебільшувати перевищувати підслуховувати доганяти перекидати брати участь платити класти читати відбудовувати міняти; заміняти рвати; розривати переказувати позбавляти їхати верхи дзвонити вставати бігати пиляти казати бачити шукати; просити продавати посилати ставити; класти шити; зашивати трусити; хитати стригти губити; втрачати світити; сяяти взувати стріляти показувати зачиняти(ся) співати тонути; осідати сидіти	overcame overdid overdrew overheard overtook overthrew partook paid put read rebuilt relaid rent retold ridded, rid rode rang rose ran sawed said saw sought sold sent set sewed shook sheared shed shone shod shot showed shut sang sank sat	overcome overdone overdrawn overheard overtaken overthrown partaken paid put read rebuilt relaid rent retold rid, ridded ridden rung risen run sawn, sawed said seen sought sold sent set sewn, sewed shaken shorn, sheared shed shone shod shot shown, showed shut sung sunk, sunken sat

 

slay sleep sling slink slit smell sow speak speed spend spoil spread stand stave steal stick stride strike strive swear swell swim swing take teach tear tell think throw thrust understand undertake wake wear win withdraw withhold write	приголомшити спати кидати; шпурляти іти крадькома розрізати вздовж пахнути сіяти; засівати говорити поспішати витрачати псувати(ся) поширювати(ся) стояти розбитися красти колоти переходити бити; страйкувати старатися присягати(ся) збільшуватися плавати гойдати(ся) брати навчати руйнувати розповідати думати кидати штовхати розуміти починати; братися будити носити вигравати відкликати відмовляти писати	slew slept slung slunk slit smelt, smelled sowed spoke sped, speeded spent spoilt, spoiled spread stood staved, stove stole stuck strode struck strove swore swelled swam swung took taught tore told thought threw thrust understood undertook woke, waked wore won withdrew withheld wrote	slain slept slung slunk slit smelt, smelled sown, sowed spoken sped, speeded spent spoilt, spoiled spread stood staved, stove stolen stuck stridden, strid struck, stricken striven sworn swollen, swelled swum swung taken taught torn told thought thrown thrust understood undertaken waked, woken worn won withdrawn withheld written

 

G L O S S A R Y

Ability-to-Pay principle of taxation principle that states taxes ought to be paid by those who can best afford them.

account 1 a an arrangement or facility at a bank or building society etc. for commercial or financial transactions, esp. for depositing and withdrawing money. b the assets credited by such an arrangement c an arrangement at a shop for buying goods on credit. 2 a (often in pl.) a record or statement of money, goods, or services received or expended, with the balance. b (in pl.) the practice of accounting or reckoning.

accounting 1 the principles and practice of systematically recording, presenting, and interpreting financial accounts; 2 financial record keeping and management of businesses and other organizations, from balance sheets to policy decisions, for tax or operating purposes.

aggregate demand the total demand for goods and services in the economy.

aggregate supply the total supply of all the goods and services in an economy.

agriculture the practice of farming, including the cultivation of the soil (for raising crops) and the raising of domesticated animals.

asset in accounting, anything owned by or owed to the company that is either cash or can be turned into cash. It covers physical assets such as land or property of a company or individual, as well as financial assets such as cash, payments due from bills, and investments.

auction a sale of goods, usu. in public, in which articles are sold to the highest bidder.

audit official inspection of a company’s accounts by a qualified accountant as required by law each year to ensure that the company balance sheet reflects the true state of its affairs.

average cost can be found by dividing total cost by total output.

balance 1 an agreement between or the difference between credits and debits in an account. 2 the difference between an amount due and an amount paid. 3 an amount left over; the rest.

balance of payments the difference in value between payments into and out of a country.

balance of trade the difference in value between imports and exports.

balance sheet statement of the financial position of a company or individual at a point in time, showing current assets and fixed assets, and current liabilities and long- term liabilities. A balance sheet must always balance, that is the sum of all the assets must equal the sum of all the liabilities.

bank a financial institution that accepts demand deposits and makes commercial loans.

bank balance the amount of money held in a bank account at a particular time.

bank-bill Brit. a bill drawn by one bank on another.

bank-book = passbook a book containing a record of a customer’s bank account.

Bank of England UK central bank founded by act of Parliament 1694. It was entrusted with issuing bank notes 1844 and nationalized 1946. It is banker to the clearing banks and the UK government.

As the government’s bank, it manages and arranges the financing of the public sector borrowing requirement and the national debt, implements monetary policy and exchange-rate policy by intervening in foreign-exchange markets, and supervises the UK banking system.

bank statement a printed statement of transactions and balance issued periodically to the holder of a bank account.

banker 1 a person who manages or owns a bank or group of banks. 2 a keeper of the bank or dealer in some gambling games.

banker’s order an instruction to a bank to pay money or deliver property, signed by the owner or the owner’s agent.

banking the business transactions of a bank.

banknote a banker’s promissory note, esp. from a central bank, payable to the bearer on demand, and serving as money.

bankroll 1 a roll of banknotes. 2 funds.

bankruptcy process by which the property of a person (in legal terms, an individual or corporation) unable to pay debts is taken away under a court order and divided fairly among the person’s creditors, after preferential payments such as taxes and wages.

bargain an agreement on the terms of a transaction or sale.

barter exchange without using money.

Benefit Principle of taxation principle that states taxes ought to be paid according to the amounts of benefit received from the government.

board of directors group of directors elected by shareholders at the annual general meeting of the company to supervise the running of the company.

bond in commerce, a security issued by a government, local authority, company, bank, or other institution on fixed interest.

book-keeping process of recording commercial transactions in a systematic and established procedure. These records provide the basis for the preparation of accounts.

boom period in the trade cycle when the economy is expanding and aggregate demand is rising quickly. It is characterized by falling or low unemployment but rising inflation.

borrowing in finance, receiving money on loan.

brand or trademark a named good in competition with other similar goods in the market.

broker intermediary who arranges the sale of financial products (shares, insurance, mortgages, and so on) to the public for a commission or brokerage fee.

brokerage a broker’s fee or commission.

building society in the UK, a financial institution that attracts investment in order to lend money, repayable at interest, for the purchase or building of a house on security of a mortgage.

budget estimate of income and expenditure for some future period, used in financial planning.

business the activity of making, buying, selling, or supplying things for a profit.

business card a card printed with one’s name and professional details.

business cycle regular fluctuations in the level of economic activity in an economy. The economy passes through phases of boom and recession, causing changes in the levels of output, unemployment, and inflation.

business studies training in economics, management, etc.

buyer’s (or buyers’) market an economic position in which goods are plentiful and cheap and buyers have the advantage.

by-law (also bye-law) 1 Brit. a regulation made by a local authority or corporation. 2 a rule made by a company or society for its members.

capital 1 the money or other assets with which a company starts in business. 2 accumulated wealth, esp. as used in further production. 3 money invested or lent at interest.

capital account the part of the balance of payments account that records flows of money in and out of the country for investment, saving, and borrowing.

capital bond an investment bond that is purchased by a single payment, set up for a fixed period, and offered for sale by a life insurance company.

capital expenditure spending on fixed assets such as plant and equipment, trade investments, or the purchase of other businesses.

capital gain a profit from the sale of investments or property.

capital goods = real or physical capital tangible items such as buildings, machinery, and equipment produced and used in the production of other goods and services. (opp. consumer goods).

capital stock the total amount of capital in a business organization or economy.

capitalism economic system in which the principal means of production, distribution, and exchange are in private (individual or corporate) hands and competitively operated for profit.

capitalist a person using or possessing capital; a rich person.

cash 1 money in coins or notes, as distinct from cheques or orders. 2 (also cash down) money paid as full payment at the time of purchase, as distinct from credit.

cash and carry 1 a system of wholesaling in which goods are paid for in cash and taken away by the purchaser. 2 a store where this system operates.

cash-book a book in which receipts and payments of cash are recorded.

cash flow the movement of money into and out of a business, as a measure of profitability, or as affecting liquidity.

cashier a person dealing with cash transactions in a shop, bank, etc.

central bank the bank responsible for issuing currency in a country. Often it is also responsible for foreign exchange dealings on behalf of the government, for supervising the banking system in the country.

charter a document granting certain specified rights, powers, privileges, or functions from the sovereign power of a state to an individual, corporation, city, or other unit of local organization.

cheque (US check) written order to pay money; a commonly used means of transferring money through the banking system.

chequebook is issued by banks and building societies typically to holders of current accounts. Chequebook holders can then write out a cheque, an order to pay money from their account to the person or company named on the cheque.

choice decision about how resources are allocated. Each choice involves an opportunity cost.

circulating capital capital that is used up quickly, such as raw materials, components, and stocks of finished goods waiting for sale.

clearing bank a commercial bank that is a member of a cheque-clearing system for the purposes of clearing cheques drawn against each others’ funds. In the UK, all the major high-street commercial banks are clearing banks.

clearing-house bankers’ establishment where cheques and bills from member banks are exchanged, so that only the balances need be paid in cash.

coin form of money. The right to make and issue coins is a state monopoly, and the great majority are tokens in that their face value is greater than that of the metal of which they consist.

collective bargaining process whereby management, representing an employer, and a trade union, representing employees, agree to negotiate jointly terms and conditions of employment.

command economy or planned economy type of economy where resources are allocated by the state through a system of planning. For example, in the former Soviet Union state planners decided what was to be produced. They passed orders down to factories, allocating raw materials, workers, and other factors of production to them.

commercial bank bank that offers services to personal and corporate customers, such as current and deposit accounts as well as loans and overdrafts (unlike savings banks or merchant banks).

commodity something produced for sale. Commodities may be consumer goods, such as radios, or producer goods, such as copper bars.

commodity markets deal in raw or semi-raw materials that are amenable to grading and that can be stored for considerable periods without deterioration.

company a number of people grouped together as a business enterprise. Types of company include public limited companies, partnerships, joint ventures, sole proprietorships, and branches of foreign companies. Most companies are private and, unlike public companies, cannot offer their shares to the general public.

competition rivalry in the marketplace between different business organizations, usually competition for custom between those who have the same commodities to dispose of. Firms can compete in many different ways including price, quality of products, availability, and delivery dates, and through advertising.

competitiveness the extent to which a producer is able to sell products in a market where other producers are selling similar products.

consumer anyone who uses goods and services.

consumer durable any commodity for personal use that has a long life, such as furniture and electrical goods, as opposed to food and drink, which are perishables and have to be replaced frequently.

consumer goods goods put to use by consumers, not used in producing other goods (opp. capital goods).

consumer research investigation of purchasers’ needs and opinions.

consumer society a society in which the marketing of goods and services is an important social and economic activity.

consumption 1 the purchase of goods and services for final use, as opposed to spending by firms on capital goods, known as capital formation. 2 an amount consumed.

corporation a business organization created under a government charter.

corporation tax tax levied on a company’s profits. It is a form of income tax, and rates vary according to country, but there is usually a flat rate. It is a large source of revenue for governments.

cost for a business, the amount of money it has to spend in order to produce goods and services for sale.

cost accountant an accountant who records costs and (esp. overhead) expenses in a business concern.

cost-benefit assessing the relation between the cost of an operation and the value of the resulting benefits (cost-benefit analysis).

cost of living cost of goods and services needed for an average standard of living.

cost price the price paid for a thing by one who later sells it.

credit means by which goods or services are obtained without immediate payment, usually by agreeing to pay interest.

credit account Brit. an account with a shop etc. for obtaining goods or services before payment.

credit card card issued by a credit company, retail outlet, or bank, which enables the holder to obtain goods or services on credit (usually to a specified limit), payable on specified terms.

creditor individual or business organization that is owed money by another individual or business. Money owed to creditors by a company is a current liability on the company’s balance sheet.

credit rating measure of the willingness or ability to pay for goods, loans, or services rendered by an individual, company, or country.

crisis (pl. crises) a time of great difficulty or danger or when an important decision must be made.

currency the type of money in use in a country; for example, the US dollar, the Australian dollar, the UK pound sterling, the German Deutschmark, and the Japanese yen.

current account that part of the balance of payments concerned with current transactions, as opposed to capital movements. It includes trade (visibles) and service transactions, such as investment, insurance, shipping, and tourism (invisibles). The state of the current account is regarded as a barometer of overall economic health.

current account at a bank type of account at a bank where money is deposited for transactions rather than savings purposes. Little or no interest is given but the customer is offered a chequebook, cheque card, and standing order and direct-debit facilities.

current asset or circulating or floating asset any asset of a business that could be turned into cash in a limited period of time, generally less than a year. Current assets include stocks, accounts receivable or billings, short-term investments, and cash.

current liability any debt of a business that falls due within one year. Current liabilities include creditors (including employees), bank overdrafts, and interest.

current prices series of prices that express values pertaining to a given time but have not been adjusted to take account of changes in purchasing power, unlike constant prices.

curve a curved line on a graph.

customs duty tax imposed on goods coming into the country from abroad.

dealer 1 a person or business dealing in (esp. retail) goods. 2 a jobber on the Stock Exchange.

dealings (pl.) contacts or transactions, esp. in business.

debit 1 an entry in an account recording a sum owed. 2 the sum recorded.
3 the total of such sums. 4 the debit side of an account.

debt something that is owed by a person, organization, or country, usually money, goods, or services.

debtor individual, business organization, or government that owes money to another. The opposite of a debtor is a creditor.

deflation a reduction in the level of economic activity, usually caused by an increase in interest rates and reduction in the money supply, increased taxation, or a decline in government expenditure.

demand a customer’s willingness and ability to buy a product or service at a particular time and place.

demand curve a curve on a graph that shows the relationship between the quantity demanded for a good and its price. It is typically downward-sloping, showing that as the price of the good goes down, the quantity demanded goes up. The demand curve will shift if there is a change in a variable which affects demand other than the price of the good.

demand elasticity explains how much a change in price affects the quantity demanded.

denomination a class of units within a range or sequence of numbers, weights, money, etc. (money of small denominations).

depreciation 1 the decline of a currency’s value in relation to other currencies.
2 the fall in value of an asset (such as factory machinery) resulting from age, wear and tear, or other circumstances. It is an important factor in assessing company profits and tax liabilities.

depression a period of low output and investment, with high unemployment.

deposit 1 Brit. a sum of money kept in an account in a bank. 2 anything stored or entrusted for safe keeping, usu. in a bank. 3 a sum payable as a first instalment on an item bought on hire purchase, or as a pledge for a contract.

deposit account in banking, an account in which money is left to attract interest, sometimes for a fixed term. Unlike a current account, the deposit account does not give constant access.

devaluation the lowering of the official value of a currency against other currencies, so that exports become cheaper and imports more expensive.

direct costs or variable cost are costs that vary directly with the volume of output, such as raw material inputs.

direct debit in banking, an instruction by a depositor with the bank to pay a certain sum of money at regular intervals.

direct tax a tax levied on the person who ultimately bears the burden of it, esp. on income or wealth, such as income tax, capital gain tax, or corporation tax.

distribution the process by which goods are sent from manufacturers to the consumer. Channels of distribution usually involve both wholesalers and retailers.

dividend the amount of money that company directors decide should be taken out of net profits for distribution to shareholders. It is usually declared as a percentage or fixed amount per share. Most companies pay dividends once or twice a year.

dividend warrant Brit. the documentary authority for a shareholder to receive a dividend.

dividend yield a dividend expressed as a percentage of a current share price.

dollar monetary unit containing 100 cents, adopted as the standard unit in the USA in 1785; also by Australia, Canada, Hong Kong, and a number of other countries.

dollar area the area in which currency is linked to the US dollar.

duty 1 payment to the public revenue, esp.: a that levied on the import, export, manufacture, or sale of goods (customs duty). b that levied on the transfer of property, licences, the legal recognition of documents, etc.

earned income income derived from wages etc. (opp. unearned income).

earnings pay including basic pay plus any additional payments such as overtime pay or bonus payments.

economic good a good that is scarce relative to the total amount of it that is desired.

economic growth rate of growth of output of all goods and services in an economy, usually measured as the percentage increase in gross domestic product or gross national product from one year to the next. It is regarded as an indicator of the rate of increase or decrease (if economic growth is negative) in the standard of living.

economics (treated as sing.) 1 a the social science that describes and analyzes how society chooses from among scarce resources to satisfy its wants. b the science of the production and distribution of wealth.

economist 1 an expert in or student of economics. 2 a person who manages financial or economic matters.

economy (pl. -ies) 1 the wealth and resources of a community, esp. in terms of the production and consumption of goods and services. 2 a particular kind of this (a capitalist economy). 3 the administration or condition of an economy.

economic system the approach a country uses to deal with scarcity and achieve its economic goals.

efficiency, economic production at lowest cost. Efficiency also relates to how resources are allocated. Resources are said to be allocated efficiently if business organizations are producing the best-quality goods for the lowest price.

elasticity the measure of response of one variable to changes in another. Such measures are used to test the effects of changes in prices and incomes on demand and supply.

employee (US employe) a person employed for wages or salary, esp. at non-executive level.

employment 1 the act of employing or the state of being employed. 2 a person’s regular trade or profession.

employment agency a business that finds employers or employees for those seeking them.

employer a person or company that employs people.

enterprise 1 an undertaking, esp. a bold or difficult one. 2 (as a personal attribute) readiness to engage in such undertakings (has no enterprise). 3 a business firm.

equity a company’s assets, less its liabilities, which are the property of the owner or shareholders.

estate 1 a property consisting of an extensive area of land usu. with a large house. 2 Brit. a modern residential or industrial area with integrated design or purpose. 3 all of a person’s assets and liabilities.

exchange 1 the act or an instance of giving one thing and receiving another in its place. 2 the giving of money for its equivalent in the money of the same or another country.

exchange rate the price at which one currency is bought or sold in terms of other currencies, gold, or accounting units such as the special drawing right (SDR) of the International Monetary Fund.

excise 1 a duty or tax levied on goods and commodities produced or sold within the country of origin. 2 a tax levied on certain licences.

expenditure 1 the process or an instance of spending or using up. 2 a thing (esp. a sum of money) expended.

expense 1 cost incurred; payment of money. 2 (usu. in pl.) a costs incurred in doing a particular job etc. (will pay your expenses). b an amount paid to reimburse this. 3 a thing that is a cause of much expense.

export goods or service produced in one country and sold to another. Exports may be visible (goods such as cars physically exported) or invisible (services such as banking and tourism, that are provided in the exporting country but paid for by residents of another country).

factor of production an input such as land or any natural resources, labour, capital, and entrepreneurship. The factors of production are combined in the production process to produce goods and services in an economy.

final goods goods ultimately bought and used by consumers.

finance 1 the management of (esp. public) money. 2 monetary support for an enterprise. 3 (in pl.) the money resources of a State, company, or person.

finance company (or house) a company concerned mainly with providing money for hire-purchase transactions.

financial institution business organization that has as its core business activity the management of money. Banks, building societies, and insurance and assurance companies are all examples of financial institutions.

financial/fiscal year a year as reckoned for taxing or accounting.

financial capital is accumulated or inherited wealth held in the form of assets, such as stocks and shares, property, and bank deposits.

financier a person engaged in large-scale finance.

firm 1 a a business concern. b the partners in such a concern.

fiscal/financial year a year as defined by a company or government for financial accounting purposes.

fixed capital is durable, examples being factories, offices, plant, and machinery.

fixed cost or overhead cost. Cost which does not vary directly with output (not a variable cost), but remains constant as output increases. For example, a company may increase its output by one third; variable costs will increase in proportion with this but fixed costs will stay the same.

foreign exchange system by which the money of one country can be converted into the money of another; US dollars, French francs, and Spanish pesetas are all foreign currencies into which a holder of pounds sterling may convert their money.

free enterprise or free market economic system where private capital is used in business with profits going to private companies and individuals.

free products products existing in such large quantities that they need not be rationed out among those wishing to use them.

free trade economic system where governments do not interfere in the movement of goods between countries; there are thus no taxes on imports.

future in business, a contract to buy or sell a specific quantity of aparticular commodity or currency (or even a purely notional sum, such as the value of a particular stock index) at a particular date in the future.

futures trading buying and selling commodities (usually cereals and metals) at an agreed price for delivery several months ahead.

glut 1 supply exceeding demand; a surfeit (a glut in the market). 2 system of making payments by direct transfer between one bank or post-office account and another.

goods (in pl.) tangible commodities or merchandise.

gross domestic product (GDP) value of the output of all goods and services produced within a nation’s borders, normally given as a total for the year. It thus includes the production of foreign-owned firms within the country, but excludes the income from domestically owned firms located abroad.

gross national product (GNP) the most commonly used measurement of the wealth of a country. GNP is defined as the total value of all goods and services produced by firms owned by the country concerned. It is measured as the gross domestic product plus income from abroad, minus income earned during the same period by foreign investors within the country.

gross pay or gross earnings or gross wages pay before deductions such as income tax and national insurance contributions. Net pay is pay after deductions.

gross profit is the difference between sales revenue and the direct cost of production. It is usually shown in the profit and loss account of the company.

heavy industry industry that processes large amounts of bulky raw materials. (iron and steel industry, shipbuilding, and aluminium smelting). Heavy industries are often tied to locations close to their supplies of raw materials.

human capital is the workforce; not just the number of workers, but also their stock of education and training which makes them productive.

imperfect competition competition between firms that supply branded products. Firms therefore compete not just on price, as in perfect competition, but on the type of good they supply.

import 1 product or service that one country purchases from another for domestic consumption, or for processing and re-exporting. 2 (in pl.) an amount imported.

incentive a measure that persuades economic agents to adopt a particular course of action.

income earnings of an individual or business organization over a period of time.

income tax direct tax levied on personal income, mainly wages and salaries, but which may include the value of receipts other than in cash.

index an indicator of a general movement in wages and prices over a specified period.

indirect costs are costs that change as output changes but not in direct proportion.

indirect tax tax on products or services. VAT (value-added tax) and excise duties are examples of indirect taxes. The opposite of an indirect tax is a direct tax, a tax on income.

industry the sector of an economy that is concerned with manufacture.

inelastic demand demand where a proportionate change in price (say 10%) leads to a lesser proportionate change in quantity demanded (say 5%). Formally, it is when the elasticity of demand is between 0 and 1.

inflation collective increases in the supply of money, in money incomes, or in prices during which the purchasing power of the dollar is falling.

inputs the factors of production (land, labour, capital and entrepreneurial ability) required by an organization to enable it to provide its outputs (goods or services).

interest in finance, a sum of money paid by a borrower to a lender in return for the loan, usually expressed as a percentage per annum.

integration merger of two firms.

investment the process of adding to the capital stock of a nation or business.

investment 1 the purchase of any asset with the potential to yield future financial benefit to the purchaser (such as a house, a work of art, stocks and shares, or even a private education). 2 expenditure on capital goods with a view to achieving profitable production for consumption at a later date. Fixed investment includes buildings, machinery, and equipment, but excludes stocks of materials used in production.

labour (US, Austral. labor) the human effort required to produce goods and services.

labour force individuals,16 years of age or older, working or looking for work.

labour market market that determines the cost and conditions of the work force, taking into consideration the demand of employers, the levels and availability of skills, and social conditions.

labour union/US a trade union associations of workers formed to promote the interests of their members.

labourer (US laborer) a person doing unskilled, usu. manual, work for wages.

land the factor of production which comprises not just land itself but all natural resources. (Shoals of fish, natural forests, the atmosphere, and rivers).

law of demand all else being equal, more items will be sold at a lower price than at a higher price.

law of diminishing the principle that additional application of one factor of production, such as an extra machine or employee, at first results in rapidly increasing output but eventually yields declining returns, unless other factors are modified to sustain the increase.

law of supply sellers will offer more of a product at a higher price and less at a lower price.

leasing form of renting, like hire purchase, typically used by businesses to finance the acquisition of land, buildings, machinery, and other industrial equipment.

legal tender currency that must be accepted in payment of debt. Cheques and postal orders are not included.

letter of credit a letter from a banker authorizing a person to draw money up to a specified amount, usu. from another bank.

liability in accounting, a financial obligation.

limited liability legal safeguard that allows shareholders to be liable for their company’s debts only up to and including the value of their shareholding.

liquidity the state of possessing sufficient money and/or assets to be able to pay off all liabilities. Liquid assets are those such as shares that may be converted quickly into cash, as opposed to property.

loan form of borrowing by individuals, businesses, and governments.

long-term liability that which is owed to creditors but does not need to be repaid in the short term (generally longer than a year).

loss in business, the opposite of profit, when revenues are less than costs.

macroeconomics division of economics concerned with the study of whole (aggregate) economies or systems, including such aspects as government income and expenditure, the balance of payments, fiscal policy, investment, inflation, and unemployment.

management process or technique of managing a business. Systems vary according to the type of organization, company, and objectives.

manager a person controlling or administering a business or part of a business.

marginal cost is the cost of producing an extra unit of output.

marginal utility the measure of additional satisfaction (utility) gained by a consumer who receives one additional unit of a product or service. The concept is used to explain why consumers buy more of a product when the price falls.

market any situation where buyers and sellers are in contact with each other. This could be a street market or it could be a world market where buyers and sellers communicate via letters, faxes, telephones, and representatives.

market-day a day on which a market is regularly held, usu. weekly.

market economy free-market economy where most resources are allocated through markets rather than through state planning.

market equilibrium a situation where prices are relatively stable and there is neither a surplus nor shortage in the market.

market forces the forces of demand (a want backed by the ability to pay) and supply (the willingness and ability to supply).

market-place 1 an open space where a market is held in a town. 2 the scene of actual dealings.

market price the price at which supply exactly equals demand.

market research the study of consumers’ needs and preferences.

marketing the theory and practice of promoting goods and services to consumers.

merchandise goods for sale.

merchant a wholesale trader, esp. with foreign countries.

merchant bank esp. Brit. a bank dealing in commercial loans and finance.

merchant banker a member of a merchant bank.

merger the linking of two or more companies, either by creating a new organization by consolidating the original companies or by absorption by one company of the others.

microeconomics the division of economics concerned with the study of individual decision-making units within an economy: a consumer, firm, or industry.

minimum wage minimum level of pay for workers, usually set by government.

mixed economy type of economic structure that combines the private enterprise of capitalism with a degree of state monopoly.

mixed farming farming of both crops and livestock.

monetarism the theory or practice of controlling the supply of money as the chief method of stabilizing the economy.

money any common medium of exchange acceptable in payment for goods or services or for the settlement of debts; legal tender.

money market institution that deals in gold and foreign exchange, and securities in the short term.

money supply quantity of money in circulation in an economy at any given time. It can include notes, coins, and clearing-bank and other deposits used for everyday payments.

monopolistic competition amarket situation in which there may be many independent buyers and sellers but in which competition is imperfect because of product differentiation, geographical fragmentation of the market, or some similar condition.

monopoly the domination of a market for a particular product or service by a single company, which can therefore restrict competition and keep prices high.

mortgage transfer of property, usually a house, as a security for repayment of a loan. The loan is normally repaid to a bank or building society over a period of years.

mortgage rate the rate of interest charged by a mortgagee.

mortgagee the creditor in a mortgage, usu. a bank or building society.

mortgager (also mortgagor) the debtor in a mortgage.

motive a factor or circumstance that induces a person to act in a particular way.

national accounts statistical report on the value of income, expenditure, and production in the economy of a country.

national income the total income of a state in one year, including both the wages of individuals and the profits of companies. It is equal to the value of the output of all goods and services during the same period. National income is equal to gross national product.

national income accounting a system of statistics that keeps track of production, consumption, saving and investment in the economy.

necessity good or service whose consumption is seen as essential in order to maintain a minimum standard of living in a society, for example food or shelter.

net financial capital is the difference between the money value of assets owned by foreigners in the domestic economy and the assets owned by the country abroad.

net profit is total revenue minus total direct and indirect cost (for example, overheads, the cost of running the business).

net worth the total assets of a company less its total liabilities, equivalent to the interest of the ordinary shareholders in the company.

oligopoly a situation in which a few companies control the major part of a particular market.

open economy an economy in which a significant percentage of its goods and services are traded internationally.

opportunity cost that which has been foregone in order to achieve an objective. A family may choose to buy a new television set and forgo their annual holiday; the holiday represents the opportunity cost.

option a contract giving the owner the right (as opposed to the obligation, as with futures contracts; see futures trading) to buy or sell a specific quantity of a particular commodity or currency at a future date and at an agreed price, in return for a premium.

organization people or groups working for a common purpose and whose tasks are often divided into specializations.

output quantity of goods and services produced or provided by a business organization or economy.

overhead costs are the costs of running the business which do not change as output changes. In economics, these three cost concepts are called variable, semi-variable, and fixed costs.

ownership the state or right of being an owner.

paradox of value the paradox that many necessities of the life have a low market price, while many luxuries with little use have a high market price.

partner a person who shares or takes part with another or others, esp. in
a business firm with shared risks and profits.

partnership unincorporated business organization owned by two or more people.

penny (pl. for separate coins -ies, for a sum of money pence) British coin and monetary unit equal to one-hundredth of a pound.

perfect competition a market in which there are many potential and actual buyers and sellers, each being too small to be an individual influence on the price; the market is open to all and the products being traded are homogeneous. At the same time, the producers are seeking the maximum profit and consumers the best value for money.

physical capital is the stock of buildings, factories, offices, machines, roads, and so on.

planned economy another term for command economy.

pound British standard monetary unit, issued as a gold sovereign before 1914, as a note 1914-83, and as a circular yellow metal-alloy coin from 1983. The pound is also the name given to the unit of currency in Egypt, Lebanon, Malta, Sudan, and Syria.

price themoneyvalue of a good or service.

price elasticity of demand responsiveness of changes in quantity demanded to a change in price of the product.

price index another term for retail price index.

prices and incomes policy governmental strategy to curb inflation; see incomes policy.

price-fixing the maintaining of prices at a certain level by agreement between competing sellers.

price-ring a group of traders acting illegally to control certain prices.

price system economic system in which resources are allocated as a result of the interaction of the forces of supply and demand.

price tag 1 the label on an item showing its price. 2 the cost of an enterprise or undertaking.

private capital is usually owned by individuals and private business organizations.

private company Brit. a company with restricted membership and no issue of shares.

private cost of production is the cost to the individual or business that created the cost.

private enterprise business unit where economic activities are in private hands and are carried on for private profit, as opposed to national, municipal, or cooperative ownership.

private means income from investments etc., apart from earned income.

private sector the part of the economy that is owned and controlled by private individuals and business organizations such as private and public limited companies.

privatization policy or process of selling or transferring state-owned or public assets and services (notably nationalized industries) to private investors.

producer a person who produces goods or commodities.

product 1 a thing or substance produced by natural process or manufacture. 2 the good or service one receives in an exchange.

product differentiation making one good different from another. Branding is an example of product differentiation. Firms attempt to differentiate their product in order to gain customer loyalty and secure an advantage over their competitors.

production the process of making a good or service.

productivity a measure of productive efficiency calculated as the ratio of what is produced to what is required to produce it.

profit amount by which total revenue exceeds total cost. It is the reward for risk