Exercise 1. Make up a sentence according to the model.

Model: How should the company pay the expenses? (borrow from the government. The company should pay the expenses by borrowing from the government.

1. How can we form an equity funding? /issue shares/.

2. How can a business sell more shares of stock? /offer a dividend/.

3. How should we know about the financial state of the company? /look over the Annual Report/.

4. How should he invest his savings? /buy common stock/.

5. How should they make people buy their bonds? /increase the interest/.

6. How can this company make a profit? /raise investment capital/.

Exercise 2. Notice the sentence from the dialogue. You need several days for that. Use this structure to respond the following sentences.

Model: It takes a month to sell the bonds. You need a month to sell the bonds.

1. It will take a half of the year to pay off the debts.

2. It takes her several days to count up net assets.

3. It won't take the company much time to repay the loan.

4. It will take him the rest of his life to learn how to run the corporation.

5. It takes them two days to sell the goods.

6. It will take them much time to decrease the outflow.

7. It will take him a month to raise the capital.

Exercise 3. Answer the questions.

1. What kind of funding is preferable: equity or debt?

2. What shares of what enterprises of your town would you buy? Explain why.

3. Imagine that your business is going to gel capital funds by borrowing. What bond interest would

you charge? Explain why.

4. What should you do to produce more inflow of capital?

5. How can you calculate the net assets of your enterprise?

6. What traits of character does a stockbroker need?

Exercise 4. Translate from Russian into English.

1. Наше предприятие нуждается в денежных фондах для покупки оборудования.

2. Я предпочитаю акционерный способ образования денежного фонда предприятии. Он привлекает

большее количество капитала.

3. Акции и облигации могут быть переуступлены, куплены, проданы.

4. Я хочу купить десятипроцентные облигации.

5. Мы намерены выплатить все долги к началу финансового года.

6. Ты получишь хорошую прибыль при продаже этих товаров.

7. Он является совладельцем компании SONY.

8. Покупка акций этой компании - хороший долгосрочный вклад.

9. Если речь идет о моих деньгах, я изучу годовой отчет компании.

Grammar Exercises

Exercise 1. Make the sentences negative.

Model: This bank was making loans to corporations during two months last year. This bank wasn't making loans to corporations during two months last year.

1. They were discussing the possibility of the purchase of inventory from 5 till 6 p.m. yesterday.

2. He was running the corporation during two months.

3. During our last classes the. lecturer was speaking about equity funding.

4. Our accountant was calculating assets liabilities and net worth two days before yesterday.

5. They were electing the new Board of Directors for two hours at their annual meeting.

Exercise 2. Put up four questions of different types (general, special, disjunctive, alternative) to each sentence.

Model: The company was doing extremely well when he was the manager.

1. Was the company doing extremely well when he was the manager?

2. When was the company doing extremely well?

3. The company was doing extremely well when he was the manager, wasn't it?

4. Was the company doing well or badly when he was the manager of the company?

1. I was examining the Annual Report when Mr. Stevenson called on me.

2. She was making a profit on the sale of the goods till she could get them.

3. He was holding a position of a stockbroker when I met him last year.

4. The shop was attracting many customers, when it was supplied by famous companies.

5. They were investing money in this business for two years.

LESSON 8

В А N К S A N D В U S 1 N E S S

Text

Banks are different in different countries. Let' s speak about the banks in the United-Slates of America. There, commercial banks are classified into two main groups. First, there are national banks. They are charted and supervised by the Federal Government. Secondly, there a re slate banks. They are charted and supervised by the stale in which they are operated. All commercial banks can make loans to borrowers

Major commercial banks in such cities as Tokyo, Paris, Rio cooperate with each other. In this way they finance imports and exports between countries.

An importer buys merchandise from another country using the currency of that country. For that purpose he buys this currency from the foreign exchange department of his bank. And in the same way if an exporter receives foreign money from sales to other countries, he sells this currency to his bank. By this method the currency of any country can usually be exchanged.

Active Vocabulary

commercial bank - коммерческий банк

national bank - национальный банк

to charter - учреждать, создавать

to supervise - заведовать, контролировать

stale bank - государственный банк

merchandise - товары

currency - валюта, деньги

foreign exchange department- отдел обмена валюты

to exchange currency - обменивать валюту

Comprehension Questions

1. What do all commercial banks do?

2. What kinds of commercial banks in the USA do you know? What are they called?

3. Who supervises the operations of national bank?

4. What kind of currency does an importer generally use when he buys goods from another country?

5. What do you know about the " intern" " ional exchange"?

6. What is the currency of this country called?

7. What is the exchange rate between your currency and the currency of the USA and Germany? How can you

find it out if you don't know it?

Vocabulary Practice

Exercise 1. Choose the necessary word and put it in the sentence.

1. Federal government..... and..... all | 1 merchandise

national banks. | 2 currency

2. International cooperation between |

banks makes it possible..... imports and |

exports. | 3 commercial

3. It is possible to convert American |

dollars to Swiss francs in..... department. | 4 foreign exchange

4. The..... of Germany is the mark. | 5 to finance

5. All..... banks make loans to borrowers. | 6 to supervise

6. If the importer buys..... from another |

country he will pay for it in the currency |

of this country. | 7 to charter

Dialogue

( A banker's office in New York City, Mr. Smith, a Vice President, is speaking to Bill Wilson).

Smith O.K. Bill. As a secretary you ought to know certain things about banking.

Bill That's what 1 want. I hope to make my career in banking.

Smith And what bank services are you familiar with?

Bill Oh, let me see. I am familiar with checking and savings accounts, safety deposit boxes, insurance and things like that.

Smith It is something.

Bill But I don't have a clear idea of the services which banks offer to business.

Smith O.K. Let's discuss it then. In f; . it is more directly concerned with what passes over my desk.

Bill I think businesses come to the banks for loans.

Smith You are right. Banks make loans to corporations, to organizations, individuals and to small companies. For this service, we always charge interest.

Bill But how can a bank decide whether a business should receive a loan.

Smith First of all we request a financial statement. It shows what the company has in inventory, accounts receivable and other assets and liabilities. Profit and loss statement shows the company's income and expenses.

Bill In other words you look over the financial situation of a business.

Smith Exactly. If the company is eligible for a loan, it may choose a long-term loan or a short-term loan.

Bill I see. And how much interest does the bank charge on these loans?

Smith It can be different. We have so-called prime-rate, that is the lowest interest rate available at the particular time. Only preferred customers can have it.

Bill Who decides on prime-rate then?

Smith Major lending banks do.

Bill Oh, I must know that. And very often I hear the term " a line of credit". I have a gigue idea what it is.

Smith A line of credit is the maximum amount of money that a company can borrow from a bank. This top amount of customer's credit is based on the profits and earnings of a business.

Bill Well. Then it is very important to have a good line of credit, isn't it?

Smith Sure. A bank also issues letters of credit. Such letter says that its holder can borrow up a certain sum of money. Or a bank can also issue a letter of credit for a person who goes to the other country where another bank is involved. Then there is the credit reference letter which recommends a company to its suppliers, and well -I could go on all morning.

Bill Thank you. It's very useful information.

Smith O.K. We can pass on to a more complicated subject. That is tax service.

Active Vocabulary

banking банковское дело

to make a career in Seth. сделать карьеру в чем-либо

bank services банковские услуги

checking account чековый счет

savings account сберегательный счет с установленным процентом

safety deposit box сейф для депозитов, предоставляемый частным лицам в банке

insurance страхование

to make a loan to sib. давать заем кому-либо

to be eligible for a loan подходящий для займа (т.е. признаваемый платежеспособным)

long-term loan долгосрочный заем

short-term loan краткосрочный заем

prime-rate наименьший процент со ссуды, установленный в определенное время и в определенном месте preferred customer привилегированный клиент

to be available наличный, имеющийся в распоряжении

line of credit кредитный лимит

to borrow занимать

letter of credit кредитное письмо, аккредитив

credit reference letter рекомендательное кредитное письмо

Vocabulary Exercises

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