HOMEWORK UNITS 23 & 24

UNITS 23

Reduce production spending recovery stimulate surplus

upturn
Listening 1: Consumption and the business cycle

Listen to Michael Kitson, who you heard in Unit 22, talking about the
causes of the business cycle, and answer the questions.

1 What does Kitson say many economists believed a year or so

previously?

He talks about the ending of the inflation and business cycle, and consistent
growth of economy nowadays.

2 According to Kitson, were they right?

No, they were not according to him, because he says that here is till
potential of both inflation and downturn of the economy.

3 What does Kitson say causes economic booms?

How the spending and consumption increased and particularly hoe the
prices of the houses are increased.

4 What about depressions?

That hey happen when people save more and consume less, when there is
no credit availability and assers decline in value.
Listening 2: Keynesianism

Listen to Michael Kitson talking about Keynesianism, the economic

theory named after John Maynard Keynes, and answer the questions.

1 Fill in the gaps below.

we still have the business cycle, OK, we can still have the possible
problems of a _downturn__ which makes the argument for what I think
is standard Keynesianism, the way you _manipulate___ budget
_balances__ depending on whether the economy's _booming__ or
budget. Or is in _recession___. OK and the government's golden rule in
the UK is consistent with that, in general. If the economy's turning
down it may make sense for governments to have budget deficits, and
to keep _expenditure__ in the economy. That's the Keynesianism
argument about ending ironing out the business cycle, which I think is
important because recessions can have very long-term _harmful__
effects.

Comprehension Match up the following half-sentences.

1 Keynes argued that left to itself, the free market system C

2 In classical theory, if consumption and investment fall, excess savings

should. A

3 Keynesians argue that during an inflationary boom government

should B

4 Keynesians argue that during an economic downturn governments

should. E

5 Monetarists argue that in the long run. F

6 Monetarists also believe that Keynesian fiscal measures G

7 There was a revival in Keynesian policies and D

UNIT 24
Listening 1: Socially responsible investment

Listen to Anna-Kim Hyun-Seung, who you heard in Unit 14, talking

about socially responsible investment, and answer the questions.

1 Which expression about business does Anna-Kim attribute to

Milton Friedman? What does it mean?

The expression she mentions is that “the business of business is business”,

that means that the only thing that companies should focus on is on making
the most out of the profits.

2 What assumption is Friedman's argument based on?

That the goals of the shareholders is to get the most out of their
investments.

3 According to what Anna-Kim says, what do you think 'socially

responsible investment' that means? That just the companies that invest
have a clear definition of the standards of social life and the environment.

4 How significant does Anna-Kim say socially responsible investment

is? She says that is only a portion or fraction of the total of the investments,
and how is it rushing to increase.

1. responsive
2. shareholders
3. community
4. employees
5. policies
6. practices
7. reputation
8. supply chain
9. human rights
10. child labour