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WHAT IS INTERNATIONAL TRADE?
When Honduras exports bananas to Switzerland, they can use the money they earn to import Swiss chocolate – or to pay for Kuwaiti oil or a vacation in Hawaii. The basic idea of international trade and investment is simple: each country produces goods or services that can be either consumed at home or exported to other countries.
The main difference between domestic trade and international trade is the use of foreign currencies to pay for the goods and services crossing international borders. Although global trade is often added up in US dollars, the trading itself involves various currencies.
Whenever a country imports or exports goods and services, there is a resulting flow of funds: money returns to the exporting nation, and money flows out of the importing nation. Trade and investment is a two-way street, and with a minimum of trade barriers, international trade and investment usually makes everyone better off.
In an interlinked global economy, consumers are given the opportunity to buy the best products at the best prices. By opening up markets, a government allows its citizens to produce and export those things they are best at and to import the rest, choosing from whatever the world has to offer.
Some trade barriers will always exist as long as any two countries have different sets of laws. However, when a country decides to protect its economy by erecting artificial trade barriers, the result is often damaging to everyone, including those people whose barriers were meant to protect.
The Great Depression of the 1930s, for example, spread around the world when the United States decided to erect trade barriers to protect local producers. As other countries retaliated, trade plumered, jobs were lost, and the world entered into a long period of economic decline.
2.Прочитайте текст снова и письменно ответьте на вопросы:
1. What’s the basic idea of international trade?
2. What’s the main difference between domestic and international trade?
3. Do trade barriers exist?
4. What opportunity are consumers given in an interlinked global economy?
5. What does government allow its citizens by opening up markets?
ВАРИАНТ 3
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INVESTORS
Investors may be organizations or individuals. Organizations as institutional investors buy securities with their funds or funds held in trust for others. Major institutional investors are insurance companies, pension funds and universities. Insurance companies make their investments generate profits and funds for paying future insurance claims. A pension fund wants to make money on its investments so that it can pay off pensioners. The other types of investors are individuals who trade securities for their own accounts. The majority of personal investors have rather small stock portfolios usually valued at less than $50 000. They often use these funds for major purchases such as a home, retirement income, or as a source of cash in case of emergency. The objectives of investors can be identified in terms of speculation, growth, and income. Some investors set an objective of achieving big payoffs. They engage in speculation, or assuming large risks in the hope of large returns. One of the ways to speculate is to buy “penny stock”. It is highly speculative stock that sells at less than $5. A $1 stock that is in high demand may rapidly run up to $3 thus tripling the initial investment. “Penny stock” is typically a share in new ventures. More investors are interested in long term growth in the value of their investment. They tend to prefer the so called blue chip stocks of large, high quality companies such as IBM, General Motors, American Express. The dividend for blue chip stocks is rather low because these firms reinvest much of their profits in research in order to remain competitive. Some investors seek income. They are interested in a stock’s yield which is the percentage return from stock dividends. The highest regular yields are provided by utility stocks because they have minimal risk. The investors take risk only within certain limits. Common stock is less safe than preferred stock because preferred stock-holders receive dividends before they are paid to the common stockholders. In the case of common stock, utilities are safer than high tech stock. The safest type of securities is government bonds because they are backed by the government.
2. Прочитайте текст снова и письменно ответьте на вопросы:
1. What kinds of investors do you know?
2. What are major investors?
3. What are the objectives of investors?
4. What do the majority of personal investors use their funds for?
5. What is the safest type of securities?
ВАРИАНТ 4
1. Прочитайте и письменно переведите на русский язык текст: