ENGLISH FOR FINANCE НАВЧАЛЬНИЙ ПОСІБНИК
UNIT 4. INVESTMENT ACTIVITY
TEXT 1. INVESTMENT ACTIVITY
Task 1. Study the vocabulary:
|
investments |
інвестиції |
|
expectation |
очікування |
|
gambling |
азартна гра |
|
stock purchases |
покупка цінних паперів |
|
shareholders |
акціонери |
|
consumption. |
споживання |
|
lending |
кредитування |
|
diversification |
диверсифікація |
|
intermediaries |
посередниким |
|
pledge |
заклад |
|
collateral |
застава |
|
assets |
активи |
Task 2. Read and translate the text:
INVESTMENT ACTIVITY
Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time. In contrast putting money into something with an expectation of gain without thorough analysis, without security of principal, and without security of return is speculation or gambling. As such, those shareholders who fail to thoroughly analyze their stock purchases, such as owners of mutual funds, could well be called speculators. Indeed, given the efficient market hypothesis, which implies that a thorough analysis of stock data is irrational, all rational shareholders are, by definition, not investors, but speculators.
Investment is related to saving or deferring consumption. Investment is involved in many areas of the economy, such as business management and finance whether for households, firms, or governments.
In finance, investment is the commitment of funds through collateralized lending, or making a deposit into a secured institution. In contrast to investment; dollar cost averaging, market timing, and diversification are phrases associated with speculation. Investments are often made indirectly through intermediaries, such as banks, credit unions, brokers, lenders, and insurance companies.
To avoid speculation an investment must be either directly backed by the pledge of sufficient collateral or insured by sufficient assets pledged by a third party. A thoroughly analyzed loan of money backed by collateral with greater immediate value than the loan amount may be considered an investment. A financial instrument that is insured by the pledge of assets from a third party, such as a deposit in a financial institution insured by a government agency may be considered an investment. Examples of these agencies include, in the United States, the Securities Investor Protection Corporation, Federal Deposit Insurance Corporation, or National Credit Union Administration, or in Canada, the Canada Deposit Insurance Corporation.
Task 3. Choose the best variant:
1. Investment has different meanings in …
a) finance and economics
b) institutions and companies
2. Investment is related to …
a) insurance companies
b) saving or deferring consumption
3. Investment is involved in many areas of the economy, such …
a) as business management and finance whether for households, firms, or governments
b) as contractual agreements
4. Investments are often made indirectly through intermediaries, such …
a) within the terms and conditions of the licenses
b) as banks, credit unions, brokers, lenders, and insurance companies.
5. A financial instrument that is insured by the pledge of assets from a third party, such as a deposit in a financial institution insured by a government agency …
a) may be considered an investment
b) in their thinking
c) rather than library-controlled sites
Task 4. Read the first part of the text again and fill in the gaps. Then read and translate:
1._________ has different meanings in finance and economics. 2._________ is putting money into something with the 3.__________ of gain that upon thorough analysis, has a high degree of security for the 4.___________, as well as 5.___________, within an expected period of time. In contrast putting money into something with an expectation of gain without thorough analysis, without security of principal, and without security of return is 6.__________or 7.___________. As such, those 8.___________ who fail to thoroughly analyze their stock purchases, such as owners of mutual funds, could well be called speculators. Indeed, given the efficient market hypothesis, which implies that a thorough analysis of stock data is 9.__________, all rational shareholders are, by definition, not 10.__________, but speculators.
Expectation, principal amount, gambling, investors, security of return, investment, irrational, shareholders, finance investment, speculation
Task 5. Read, translate and remember:
In finance, investment is the commitment of funds through collateralized lending, or making a deposit into a secured institution.
In contrast to investment; dollar cost averaging, market timing, and diversification are phrases associated with speculation.
Investments are often made indirectly through intermediaries, such as banks, credit unions, brokers, lenders, and insurance companies.
To avoid speculation an investment must be either directly backed by the pledge of sufficient collateral or insured by sufficient assets pledged by a third party.
A thoroughly analyzed loan of money backed by collateral with greater immediate value than the loan amount may be considered an investment.
A financial instrument that is insured by the pledge of assets from a third party, such as a deposit in a financial institution insured by a government agency may be considered an investment.
Task 6. Read the whole text again and choose the best answer:
1. Has investment different meanings in finance and economics?
a) yes
b) no
2. Is finance investment putting money into something with the expectation of gain?
a) yes
b) no
c) It depends
3. In what areas of the economy the investment is involved?
a) in a financial institutions
b) Investment is involved in many areas of the economy, such as business management and finance whether for households, firms, or governments.
4. Through what intermediaries investments are often made?
a) Investments are often made indirectly through intermediaries, such as banks, credit unions, brokers, lenders, and insurance companies.
b) within the conditions of the licenses?
5. How to avoid speculation within investment?
a) To avoid speculation an investment must be either directly backed by the pledge of sufficient collateral or insured by sufficient assets pledged by a third party.
b) insured by a government agency
TEXT 2. FOREIGN INVESTMENT
Task 1. Study the vocabulary:
|
foreign investment |
іноземні інвестиції |
|
expanding operations |
розширення операцій |
|
existing business |
існуючий бізнес |
|
investment privileges |
інвестиційні пільги |
|
tax exemptions |
податкові пільги |
|
tariff-free access |
безмитний доступ |
|
portfolio investment |
портфельні інвестиції |
|
stocks and bonds |
акції та облігації |
|
national accounts |
національні рахунки |
|
equity capital |
акціонерний капітал |
|
balance of payments |
платіжний баланс |
|
joint-venture |
спільне підприємство |
Task 2. Read and translate the text:
Foreign direct investment (FDI) is direct investment into one country by a company in production located in another country either by buying a company in the country or by expanding operations of an existing business in the country. Foreign direct investment is done for many reasons including to take advantage of cheaper wages in the country, special investment privileges such as tax exemptions offered by the country as an incentive to gain tariff-free access to the markets of the country or the region. Foreign direct investment is in contrast to portfolio investment which is a passive investment in the securities of another country such as stocks and bonds.
As a part of the national accounts of a country FDI refers to the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, other long-term capital, and short-term capital as shown the balance of payments. It usually involves participation in management, joint-venture, transfer of technology and expertise. There are two types of FDI: inward foreign direct investment and outward foreign direct investment, resulting in a net FDI inflow (positive or negative) and "stock of foreign direct investment", which is the cumulative number for a given period. Direct investment excludes investment through purchase of shares. FDI is one example of international factor movements.
The United States is the world’s largest recipient of FDI. U.S. FDI totaled $194 billion in 2010. 84% of FDI in the U.S. in 2010 came from or through eight countries: Switzerland, the United Kingdom, Japan, France, Germany, Luxembourg, the Netherlands, and Canada. The $2.1 trillion stock of FDI in the United States at the end of 2008 is the equivalent of approximately 16 percent of U.S. gross domestic product (GDP).
Task 3. Choose the best variant:
1. Foreign direct investment (FDI) is direct investment into one country by a company in production located in another country either …
a) by buying a company in the country or by expanding operations of an existing business in the country
b) by contractual agreements
2. Foreign direct investment is in contrast to portfolio investment which is a passive investment in the securities of another country such as … .
a) as stocks and bonds
b) as licenses
3. It is the sum of equity capital, other long-term capital, and short-term capital …
a) as shown the balance of payments
b) as matter what at work
4. Direct investment excludes investment through …
a) their professional judgment
b) purchase of shares
5. The $2.1 trillion stock of FDI in the United States at the end of 2008 is the equivalent of approximately... .
a) cumulative number for a given period
b) 16 percent of U.S. gross domestic product (GDP).
Task 4. Read the first part of the text again and fill in the gaps with a word given below. Then read and translate:
1.___________ 2.__________is direct investment into one country by a company in production located in another country either by buying a company in the country or by 3.___________ of an 4.___________ in the country. Foreign direct investment is done for many reasons including 5.___________ of 6._________ in the country, special 7.__________ such as 8.__________offered by the country as an incentive to gain 9.__________ to the markets of the country or the region. Foreign direct investment is in contrast to portfolio investment which is a passive investment in the securities of another country such as 10._________.
stocks and bonds, tariff-free access, investment privileges, cheaper wages, existing business, expanding operations, tariff-free access, FDI, to take advantage, tax exemptions
Task 5. Read, translate and remember:
As a part of the national accounts of a country FDI refers to the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor.
It is the sum of equity capital, other long-term capital, and short-term capital as shown the balance of payments.
It usually involves participation in management, joint-venture, transfer of technology and expertise.
There are two types of FDI: inward foreign direct investment and outward foreign direct investment, resulting in a net FDI inflow (positive or negative) and "stock of foreign direct investment", which is the cumulative number for a given period.
Direct investment excludes investment through purchase of shares. FDI is one example of international factor movements.
Task 6. Read the whole text again and choose the best answer:
1. Is foreign direct investment done for many reasons?
a) yes
b) no
2. Is foreign direct investment in contrast to portfolio investment?
a) yes
b) no
c) It depends
3. Where does it involve participation?
a) in a financial institutions
b) It usually involves participation in management, joint-venture, transfer of technology and expertise
4. How many types of FDI are there?
a) There are two types of FDI
b) There are three types of FDI
c) within the conditions of the plan?
5. What country is the largest recipient of FDI?
a) The United Kingdom is the world’s largest recipient
b) The United States is the world’s largest recipient of FDI
TEXT 3. LICENSING
Task 1. Study the vocabulary:
|
worldwide marketplace |
світовий ринок |
|
electronic information resources |
електроннi інформаційнi ресурси |
|
mediators |
посередники |
|
accessible |
доступний |
|
counterparts |
колеги |
|
deal by deal |
справу за справу |
|
patron access |
доступ для читача |
|
electronic archiving issues |
електронне архівування питання |
|
a set of commitments |
ряд зобов'язань |
|
traditional media |
традиційні засоби масової інформації |
|
long-term archiving |
довгострокове архівування |
|
to express concerns |
висловлювати стурбованість |
Task 2. Read and translate the text:
LICENSING
The worldwide marketplace for all types of electronic information resources is rapidly being developed as publishers and vendors who create electronic information seek to attract libraries of all types (public, academic, special, national) as their customers. Today, libraries around the world continue in their role as mediators between citizens, including those affiliated with specific institutions, and information and cultural expression roles that persist even more – energetically, it appears, for electronic information than for print. And, just as libraries advance the archiving and preservation of traditional media, so they are seeking ways to ensure that electronic resources will be archived and preserved to be accessible over a long period of time. Pricing also remains an issue: libraries continue to express concerns about the fact that a number of electronic resources appear to be priced higher than were their print counterparts.
While the library community strongly supports the continuation into the digital environment of exceptions that have been granted under copyright law, there are some areas where different procedures and policies need to be developed to handle electronic publications. Use of electronic information everywhere in the world is, at this time, usually defined and described by contractual agreements, otherwise known as licenses. These licenses describe comprehensively the terms of the provider/library relationship. Contracting is a comparatively new (1990s) way of doing business for most parties in the information chain.
Licenses are pure marketplace arrangements in which a willing information provider and a willing purchaser of information access come together to make arrangements, deal by deal, resource by resource.
User rights are defined within the terms and conditions of the licenses. They are not governed by (comparatively well understood) copyright legislation to the same extent as is the use of "fixed" or traditional information formats.
Libraries generally provide patron access to such information via access to remote publisher or vendor sites, rather than library-controlled sites. Yet, the tasks and costs of libraries and information providers with regard to long-term archiving and preservation of electronic resources are disturbingly unclear. While a license cannot resolve this complicated set of electronic archiving issues, it will, generally, recognize them and express a set of commitments or expectations on the part of the contracting parties.
IFLA (International Federation of Licensing Agreement) views the licensing arena positively, although key issues remain to be resolved. In particular, licensing is showing itself responsive to the complex business arrangements being entered into between information providers and library consortia of different types and sizes. IFLA encourages and supports the evolution of all types of libraries negotiating as consortia.
Task 3. Choose the best variant:
1.The worldwide marketplace for all types of electronic information resources is rapidly being developed …
a) as publishers and vendors
b) as institutions and companies
c) fully
2.Use of electronic information everywhere in the world is, at this time, usually defined and described …
a) quickly
b) by contractual agreements, otherwise known as licenses
c) simply and clearly
3. User rights are defined within the terms and conditions of the licenses.…
a) within the terms and conditions of the licenses
b) it doesn’t matter what at work
c) carefully
4. Libraries generally provide patron access to such information via access to remote publisher or vendor sites…
a) their professional judgment
b) in their thinking
c) rather than library-controlled sites
5. IFLA encourages and supports the evolution…
a) should be partial
b) of all types of libraries negotiating as consortia
Task 4. Read the first part of the text and fill in the gaps. Then read and translate:
While the 1.____________ community strongly supports the continuation into the 2.__________ environment of exceptions that have been granted under 3.____________ there are some areas where different procedures and policies need to be developed to handle 4.__________ publications. Use of electronic 5.__________ everywhere in the world is, at this time, usually defined and described by 6._________ agreements, otherwise known as 7.__________. These licenses describe comprehensively the terms of the 8.__________ relationship. 9.__________ is a comparatively new 1990s way of doing business for most parties in the information 10._________.
Library, license, chain, information, digital, provider/library, contractual, electronic, copyright law, contracting
Task 5. Read, translate and remember:
User rights are defined within the terms and conditions of the licenses. They are not governed by (comparatively well understood) copyright legislation to the same extent as is the use of "fixed" or traditional information formats.
Libraries generally provide patron access to such information via access to remote publisher or vendor sites, rather than library-controlled sites.
Yet, the tasks and costs of libraries and information providers with regard to long-term archiving and preservation of electronic resources are disturbingly unclear.
While a license cannot resolve this complicated set of electronic archiving issues, it will, generally, recognize them and express a set of commitments or expectations on the part of the contracting parties.
Task 6. Read the whole text again and choose the best answer:
1. Do you think that the worldwide marketplace for all types of electronic information resources is rapidly being developed?
a) yes
b) no
2. Do today’s libraries around the world continue in their role as mediators between citizens?
a) yes
b) no
c) you should know
3. Are they seeking ways to ensure electronic resources?
a) to be archived and preserved to be accessible over a long period of time
b) so as to present a coherent picture that is consistent
4. Are user rights defined within the terms and conditions of the licenses?
a) User rights are defined within the terms and conditions of the licenses
b) These rights defined within the conditions of the licenses?
5. What does IFLA encourage and support? the evolution of all types of libraries negotiating as consortia?
a) IFLA encourages and supports the evolution of all types of libraries
b) IFLA encourages and supports the evolution of all types of libraries negotiating as consortia.
TEXT 4. FRANCHISING
Task 1. Study the vocabulary:
|
premature cancellations |
передчасні cкасування |
|
terminations |
обмеження |
|
various tangibles |
різні матеріальні активи |
|
intangibles |
нематеріальні активи |
|
fast food restaurants |
ресторани швидкого харчування |
|
chains in conjunction |
ланцюги в поєднанні |
|
vending machine |
торговий автомат |
|
lease the branded name |
оренда фірмових назв |
|
exclusive agreements |
ексклюзивні угоди |
|
entire term |
цілий термін |
|
realizing profits |
реалізація прибутку |
|
collect royalties |
збирати роялті |
Task 2. Read and translate the text:
FRANCHISING
Franchising refers to the methods of practicing and using another person's philosophy of business. The franchisor grants the independent operator the right to distribute its products, techniques, and trademarks for a percentage of gross monthly sales and a royalty fee. Various tangibles and intangibles such as national or international advertising, training, and other support services are commonly made available by the franchisor. Agreements typically last five to twenty years, with premature cancellations or terminations of most contracts bearing serious consequences for franchisees.
The term "franchising" is used to describe business systems which may or may not fall into the legal definition provided above. For example, a vending machine operator may receive a franchise for a particular kind of vending machine, including a trademark and a royalty, but no method of doing business.
A franchise agreement will usually specify the given territory the franchisee retains exclusive control over, as well as the extent to which the franchisee will be supported by the franchisor (e.g. training and marketing campaigns).
The franchisor typically earns royalties on the gross sales of the franchisee. In such cases, franchisees must pay royalties whether or not they are realizing profits from their franchised business.
Cancellations or terminations of franchise agreements before the completion of the contract have serious consequences for franchisees. Franchising dates back to at least the 1850s; Isaac Singer, who made improvements to an existing model of a sewing machine, wanted to increase the distribution of his sewing machines. A later example of franchising was John S. Pemberton's successful franchising of Coca-Cola. Earlier models of product franchising collected royalties or fees on a product basis and not on the gross sales of the business operations of the franchisees.
This trend started before 1933 with quick service restaurants such as A&W Root Beer. In 1935, Howard Deering Johnson teamed up with Reginald Sprague to establish the first modern restaurant franchise. The idea was to let independent operators use the same name, food, supplies, logo and even building design in exchange for a fee.
The growth in franchises picked up steam in the 1930s when such chains as Howard Johnson's started franchising motels. Fast food restaurants, diners and motel chains exploded. In regard to contemporary franchise chains, McDonalds is unarguably the most successful worldwide with more restaurant units than any other franchise network.
Franchising is a unique business model that has encouraged the growth of franchised chain formula units because the franchisors collect royalties on the gross sales of these units and not on the profits. Franchising is a business model used in more than 70 industries and that generates more than $1 trillion in U.S. sales annually.
Task 3. Choose the best variant:
1. Franchising refers to the methods of practicing and using …
a) publishers and vendors
b) another person's philosophy of business
2. The franchisor typically earns royalties …
a) on the gross sales of the franchisee
b) on licenses
3. Cancellations or terminations of franchise agreements before the completion of the contract …
a) have serious consequences for franchisees
b) it doesn’t matter what at work
4. Modern franchising came to prominence with the rise of franchise-based …
a) their professional judgment
b) food service establishments
5. Franchising is a business model used in more than 70 industries and that generates …
a) more than $1 trillion in U.S. sales annually
b) all types of negotiating
Task 4. Read the first part of the text again and fill in the gaps. Then read and translate:
1. ________ refers to the methods of practicing and using another person's philosophy of 2.________. The 3._________ grants the independent operator the right to 4.________ its products, techniques, and trademarks for a percentage of gross monthly sales and a 5.__________. Various tangibles and 6._________ such as national or international advertising, training, and other support services are commonly made 7.________ by the franchisor. 8._________. typically last five to twenty years, with premature cancellations or 9._________ of most contracts bearing serious 10.__________ for franchisees.
Franchising, available, intangibles, royalty fee, franchisor, consequences, terminations, agreements, distribute, business
Task 5. Read, translate and remember:
Franchising dates back to at least the 1850s; Isaac Singer, who made improvements to an existing model of a sewing machine, wanted to increase the distribution of his sewing machines. His effort, though unsuccessful in the long run, was among the first franchising efforts in the United States.
A later example of franchising was John S. Pemberton's successful franchising of Coca-Cola. Early American examples include the telegraph system, which was operated by various railroad companies but controlled by Western Union, and exclusive agreements between automobile manufacturers and operators of local dealerships.
Earlier models of product franchising collected royalties or fees on a product basis and not on the gross sales of the business operations of the franchisees.
Modern franchising came to prominence with the rise of franchise-based food service establishments. This trend started before 1933 with quick service restaurants such as A&W Root Beer. In 1935, Howard Deering Johnson teamed up with Reginald Sprague to establish the first modern restaurant franchise.
The idea was to let independent operators use the same name, food, supplies, logo and even building design in exchange for a fee.
Task 6. Read the whole text again and choose the best answer:
1. Does Franchising refer to the methods of practicing and using another person's philosophy of business?
a) yes
b) no
2. Do agreements typically last three to five years?
a) yes
b) No , agreements typically last five to twenty years
c) you should know
3. How does the franchisor earn royalties?
a) accessible over a long period of time
b) The franchisor typically earns royalties on the gross sales of the franchisee
4. When did franchising start?
a) Franchising dates back to at least the 1850s
b) It dates back to the 1920s
5. What are the most successful worldwide units of franchise network?
a) all types of restaurant units
b) McDonalds is unarguably the most successful worldwide with more restaurant units than any other franchise network