BUSINESS ENGLISH 1

RESOURCE BANK
Version B
2021/22

Compiled by:
The Department of Business Foreign Languages
Faculty of Economics and Business
University of Zagreb
 2
COURSE CONTENTS
TOPIC TEXT SOURCE
Course Contents RB*
INTRODUCTION RB Contents RB
Business English I: Information for Students RB
1 UNIVERSITY ESSENTIALS University Essentials RB
The Bologna Process RB

2 ECONOMICS vs. ECONOMY Economy and Economics RB

3 THE DIFFERENT SECTORS OF The Different Sectors of the Economy MK 7

THE ECONOMY Sectors of Economic Activity RB
4 THE THREE TYPES OF ECONOMIC The Three Types of Economic Systems RB
SYSTEMS
The Public Sector RB
5 THE PUBLIC SECTOR The Role of Government RB
Government and Taxation MK 22
Taxation RB
Privatization RB
The Pendulum of Control RB
6 THE PRIVATE SECTOR: TYPES Venture Capital MK 15
OF BUSINESS ORGANIZATIONS The Private Sector RB
Business Organizations in the UK RB
Business Organizations in Croatia RB
Legal Types of Business Organizations:
A Contrastive View RB
Entrepreneurship RB

7 MANAGEMENT Management MK 1
Company Structure MK 7
Company Structure: Exercises RB
8 EMPLOYEES AND LABOUR Work and Motivation MK 2
RELATIONS Efficiency and Employment MK 25
Employees and Labour Relations RB
9 RECRUITMENT Recruitment MK 5
Recruitment: Exercises RB

10 MARKETING Products MK 11
Marketing MK 12
Advertising MK 13
The Centrality of Marketing RB
The Four Major Promotional Tools RB

Note-taking & Note-making RB

SKILLS REFERENCE Paragraphing RB
Business Meetings RB
Business Correspondence RB
* RB = Resource Bank compiled by the Dept. of Business Foreign Languages
** MK = Coursebook English for Business Studies written by Ian McKenzie and published by
Cambridge University Press 2010 (the figure indicates the unit related to the specific topic)
 3
RESOURCE BANK CONTENTS
TOPIC TEXT PAGE
Course Contents 2

INTRODUCTION RB Contents 3
Business English I: Information for Students 4

1 UNIVERSITY ESSENTIALS University Essentials 6

The Bologna Process 13
2 ECONOMICS vs. ECONOMY Economy and Economics
15
3 THE DIFFERENT SECTORS OF Sectors of Economic Activity 23

THE ECONOMY
4 THE THREE TYPES OF ECONOMIC The Three Types of Economic Systems 29

SYSTEMS

REVISION 1 32

The Public Sector 34

5 THE PUBLIC SECTOR
The Role of Government 36
Taxation 38
Privatization 43
The Pendulum of Control 46

6 THE PRIVATE SECTOR: TYPES The Private Sector: Types of Business 47

Organizations
OF BUSINESS ORGANIZATIONS

REVISION 2 56

7 ENTREPRENEURSHIP Going into Business 58

Crazy Diamonds 62

8 MANAGEMENT: COMPANY Company Structure 65

STRUCTURE
9 EMPLOYEES AND LABOUR Employees and Labour Relations 67

RELATIONS

10 RECRUITMENT Recruitment 69

REVISION 3 72

11 MARKETING Products 74
The Centrality of Marketing 76
The Four Major Promotional Tools 78
REVISION 4 81

12 SKILLS REFERENCE Note-taking & Note-making 83

Paragraphing 86
Business Meetings 90
Business Correspondence 104

Business Correspondence 125

REVISION 5

13 GROUP PROJECT Your Business Plan 131

 4
INTRODUCTION

Business English I
Information for Students

COURSE AIMS

This course aims to:

 develop your business communication skills (written and oral)

 help students acquire specialist vocabulary (on selected business topics)
 strengthen students’ academic skills
 help students understand the difference between written/spoken language and
formal/informal language
 develop students’ critical thinking skills (analysis, synthesis, foreseeing, deducing,
selecting...)
 help students learn how to use dictionaries and other reference material

COURSE REQUIREMENTS

1 Regular attendance and class participation

Regular attendance is obligatory.

Class participation implies contribution to class work, which requires preparing for classes in
advance (home assignments, research, project work, studying, etc.).

2 The role-played meeting should demonstrate:

 successful team work

 thorough research
 a clear structure
 the effective use of the language of meetings

3 Passing two written progress tests or one comprehensive written test at the end of
the term

The written tests will examine:

 your reading skills: understanding articles and reports concerned with contemporary
business issues
 your writing skills: ability to write business letters using the appropriate style
(register, clarity, coherence, concision, layout)
 your recognition and active use of specialist vocabulary

4 Passing the final oral exam

At the final oral exam, you are expected to:

 demonstrate your ability to clearly and coherently discuss business topics covered by
the course using specialist vocabulary
 express a viewpoint on a topical issue (advantages, disadvantages, agreeing,
disagreeing…) and ask relevant questions.
 5
REQUIRED LITERATURE

MacKenzie, I. (2010) English for Business Studies (3rd Ed), CUP

Business English Resource Bank 1, Version B 2021/22

RECOMMENDED LITERATURE

Business dictionaries:

 Longman Business English Dictionary (most recent edition)

 Oxford Business English Dictionary for learners of English & CD-ROM (2005)

 Poslovni rječnik (Englesko-hrvatski), Školska knjiga (2006)

 Špiljak-Ivir: Englesko-hrvatski poslovni rječnik, Masmedia (2000)

 Zgombić: Business Dictionary (englesko-hrvatski), Zgombić & partneri

Grammar books:

 Murphy, R. (2004) English Grammar In Use with Answers and CD ROM: A Self-study
Reference and Practice Book for Intermediate Students of English (Paperback),
Cambridge -University Press

 Strutt, P. (2000) Business Grammar in Usage, Longman

 Emmerson, P. (2002) Business Grammar Builder, Macmillan

SUGGESTED ADDITIONAL SOURCES

 Business Week, The Financial Times, The Economist …

 CNBC, Bloomberg, business programmes on BBC and CNN

 web sites: bized.com, investopedia.com, quickmba.com, startup.wsj.com,

dictionary.com, harvardbusinessonline.hbsp.harvard.edu, encarta.msn.com,
acronymfinder.com, uefap.com, cusd.com/calonline/econ
 6
1 UNIVERSITY ESSENTIALS

I Study the university essentials below and on the opposite page. Find English
equivalents for the following Croatian words/expressions:

predmet pohađanje nastave

program predmeta Sveučilište u Zagrebu

obavezni predmet brucoš

predavač preddiplomski studij

Katedra za računovodstvo redovni student

nastavni program pasti ispit

seminarski rad diplomski studij

magisterij završni ispit

izborni predmet diplomirati na smjeru

dekan upisati predmet

predati rad referada

nastavnici Pročelnik katedre

prijaviti se za ispit izvanredni student

EFZG poslijediplomski studij

doktorat diplomirati ekonomiju

II Answer these questions.

1 What do you study?
2 Where do you study?
3 Are you a graduate or an undergraduate student?
4 Are you a part-time or a full-time student?
5 Are you a freshman or a sophomore?
6 Which degree will you earn when you graduate?
7 Will you hold a Bachelor’s or a Master’s degree after a 5-year study program?
8 What degrees did previous generations receive when they attended the 4+1-year program?
9 When do you choose your major?
10 What does ECTS stand for?
11 Who is the Dean of the Faculty of Economics and Business?
12 Who is the Head of the Department of Business Foreign Languages?
13 Is BE a compulsory or an elective course?
14 Will you have to write papers in BE course?
15 Is there a difference between class attendance and class participation?
16 Why do you have to attend this course regularly?
17 How do you become eligible for the teacher’s signature at the end of the semester?
18 Where can you find the BE syllabus?
19 How do you apply for the exam?
 7
ACADEMIC DEGREES:

1ST degree Bachelor's degree Bachelor of Arts (BA) v. Bachelor of Science (BSc)
nd
2 degree Master's degree Master of Arts (MA) v. Master of Science (MSc)
3rd degree Doctor's (doctoral) degree, (PhD)

In writing :Jake Lenard, BSc In conversation: «Mr Lenard, ...» (no title)
Anne Stern, MA «Ms Stern, ...» (no title)
Henry Hill, PhD «Dr. Hill, ...» (title)
Examples: She is a Bachelor of Economics.
She has a Master's degree in Economics.
She is a Master of Business Administration (MBA).
He has a BA in Economics.
He has received his PhD degree from the University of Zagreb.
STUDENTS ORGANIZATION

full-time students The Faculty of Economics and

part-time students Business
first-year students The University of Zagreb
second-year students
Rector (Vice-Chancellor)
undergraduate students
graduate students (*BE vs. AE* vs. Bologna) The School, The Faculty, The
postgraduate students Department*
freshmen (AE) (Dean and Vice-Deans)
sophomore (AE) Department (e.g. Department of
junior student
Accounting)
senior student
Head of Department
She is a major in Finance.
She majored in Finance. Student Administration Office

PAPERS AND EXAMINATION

FACULTY (TEACHING STAFF)
exams
professors, lecturers, assistants written exam / oral exam
final exam, comprehensive exam,
mid-term exam, preliminary exam,
COURSES quiz
sign up for an exam
core course vs. non-core course
apply for an exam
compulsory (mandatory) course take an exam
vs. pass an exam
elective course, optional course fail an exam

curriculum (sg.), curricula (pl.) papers

write a paper on monetary policy.
syllabus (sg.), syllabi (pl.)
submit a paper
take a course in...enrol on a course (enrolment) hand in a paper
attend a course in .... (attendance) correct a paper
grade a paper
participate in classes (class participation)
mark a paper
He read history at Oxford. grades, marks
 University essentials - Choosing the right school 8

Your friend, Jonas asked you to help him choose a school to apply to after high-school.
First, discuss what Jonas's long-term goals are, then read about the two options below
and decide which would be best for him. Give reasons for your choice.

Jonas lives in Boston, MA with his younger sister and parents. His parents are doctors, they live
well but they are not rich. Theirs is a typical middle-class family. Jonas is a good student with a
3.8 GPA1. He is not sure what he wants to do later in life, but is interested in studying economics
and business. His favorite classes in high-school were Math, Physics and History. He played
basketball in his high-school’s team and has other hobbies, such as building robots. He has a
large group of friends and enjoys going out in the evening.

After reading about the two schools Jonas is considering, structure your answer in the
following way:

We think Jonas should choose ____________________, because of the following reasons:

Firstly, _____________________________________________________________________
This would suit Jonas because __________________________________________________.
Secondly,
_____________________________________________________________________.
This would be good for Jonas since _________________________________________________
_____________________________________________________________________________.
Thirdly, _____________________________________________________________________
Jonas would like this because ___________________________________________________.
Fourthly, etc.

______________________ name of the school is at an advantage over _________________

name of the school because __________________________________________________

etc.

On the other hand, there are some disadvantages to choosing ______________________ name

of the school you chose for Jonas. These are the fact that _____________________________

___________________________________________________________________________.
Or that ______________________________________________________________________.
etc.
Describe what Jonas needs to do to apply to the college or university of your choice.
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________

1
Grade Point Average. 3.8 is an A, A- average in all courses.
Verton College is a small rural college situated on a wooded hilltop just outside the town of 9
Verton, Iowa. The surroundings of the college are taken advantage of both in classes and extra-
curricular activities. The campus also involves a farm and hiking trails. This highly competitive
college prides itself on offering a world-class education in an open and relaxed atmosphere.

Bakers University is a large urban university situated in Seattle, only a few miles away from the
city center. Although the university offers on-campus housing to all students, many elect to rent in
the city. The university maintains excellent connections with many governmental, business and
educational institutions in the city, providing opportunities for internships, research assistantships
and other real-world experience for students.

Verton College Bakers University

Location: Rural Urban

Type: Private Public
Tuition fee (annual, full- $20,000 $9,000
time students):
Room and board: $10,000 $7,000
Merit-based All students are considered for a All students are considered for a
scholarships: merit-based scholarship. 30% of merit-based scholarship. 15% of
students are given a scholarship. students are given a scholarship.
Average scholarship: $10,000 Average scholarship: $5,000
Athletic scholarships: 5% None
Average scholarship: $4,000
Percentage of students 50% 60%
who receive government Average grant: $6,000. Average grant: $4,000.
grants or other financial
aid:
Student loans: Available Available
Degrees offered: Bachelor's degree Bachelor's degree
Master's degree
Doctorate
Number of majors: 10 including Economics and 25 including:
Business, Robotics Economics and Business
Management
Total students: 2,000 15,000
Male / female student M: 47% F: 53% M: 35% F: 65%%
ratio:
Student – faculty ratio: 7 25
Courses taught by 60% 40%
senior staff (full
professors, associate
professors):
Courses marked via 20% 40%
exams:
Courses marked via 80% 60%
course work:
Additional information: Music festival held yearly Internship opportunity at leading
firms
Acceptance rate: 25% 50%
Application procedure: Application form Application form
Personal essay 2 letters of reference
2 letters of reference high-school transcript
high school transcript
Interview (in person or via Skype)


Consult the school's website for a full list of majors.
 10
VOCABULARY FOCUS
I Look back at the task on the previous page, complete the key expressions and
then explain their meaning:
1. A__ __ LY to a C__LL__G__ 2. GR__D__ point __V__R__G__
3. A__ __ EPT__ NCE rate 4. __N__V__RS__TY
5. __XTR__-C__RR__C__L__R activities 6. C__MP__S
7. PR__ __ __ __E school 8. P__BL__C school
9. T__ __T__ __N fee 10. SCH__L__RSH__P (merit based or athletic)
11. government GR__NTS 12. financial __ __D
13. student L__ __N 14. B__CH__L__R'S degree
15. M__ST__R'S degree 16. D__CT__R__T__
17. M__J__R 18. M__N__R
19. S__ __D__NT – F__ __ __LTY ratio 20. S__N__ __R staff v. junior staff
21. courses M__RK__D via __X__MS 22. courses M__RK__D via C__ __RS__ work
23. letter of R__F__R__NC__ 24. high-school TR__NSCR__PT

Which of these terms refer to…

1 the application process?
2 the place you learn?
3 money you have to pay for schooling?
4 help you can get to pay for school?
5 what you study?
6 the way a class is graded / marked?
7 the people who teach you?
8 the type of degree you get at the end of your studies?

VOCABULARY PRACTICE: UNIVERSITIES AND COLLEGES

I Read and fill in the gaps in the sentences with the words from the box.

Going to university in Britain

master’s degree maintenance tuition fees first degree Bachelor of Arts

1 After school many British students go to university. They apply to several universities
through UCAS (Universities and Colleges Admission Service) and receive offers of a place
on condition that they achieve certain grades in their A levels.
2 Most universities receive some money from the state. The oldest and most famous are
Oxford and Cambridge. Other much respected universities include London, Durham and St
Andrew’s. Some universities such as Birmingham and Manchester are called redbrick
universities because they were built in the 19th century with brick rather than stone. The
newer universities have their buildings grouped together on a campus.
3 A , which is usually an honours degree, generally takes three years.
Most courses end with exams called finals. Results are given as classes (=grades): a first is
the highest class, seconds are often split between upper second and lower second, and
below that is a third. Graduates may add the letters BA ( ) or BSc
(Bachelor of Science) after their name. Some graduates go on to study for further degree,
often a or a doctorate.
4 Higher education is not free. In principle students have to pay a contribution to the cost
of teaching ( ) and have also to pay their living costs
( ). The government provides loans to help them pay for
university education which have to be paid back from earnings once their income reaches
a certain level.
 11
Going to college in the US

application TOEFL associate’s degree transcript graduate

undergraduate

5 Americans talk about “going to college” even if the institution they attend is a university.
To Americans the phrase “going to university” sounds pretentious. Most colleges offer classes
only for students studying for a bachelor’s degree. Community
colleges offer two-year courses leading to an , and afterwards
students transfer to a different college or university to continue their studies. Universities are
larger than colleges and also offer courses for students who study in
graduate school. Many universities also have separate professional schools, e.g. a medical
school or a law school.
6 American high school students who want to study at a college or university have to take
a standardized test, e.g. the SAT (Scholastic Aptitude Test) or the ACT (American College
Test). Students from countries outside the US who are not native speakers of English must
also take the (Test of English as a Foreign Language). Each college or
university decides on the minimum score it will accept, though test scores are never the only
factor taken into account. Students apply direct to between three and six colleges in their last
year of high school. Each college has its own form and most include
a question for which the student must write an essay. The student also has to send a
(=an official list of all the subjects studied and the grades received)
and letters of reference.
grants financial aid Ivy League scholarship board loan
7 There are many private colleges and universities but most students choose a public
institution because the costs are lower. All universities charge tuition, and students pay extra
for room and . Prices range from a few hundred dollars a year to well over
$25 000 at some private colleges. Students whose families cannot afford to pay the full
amount apply for . Many students receive a financial aid package which
may be a combination of from the government, a , a student
and work-study (=a part-time job at the college).
8 The most famous universities are those in the_ , including Harvard and
Yale, but many others have good reputations. Large universities often put most emphasis on
research. Smaller colleges tend to concentrate on teaching undergraduates, and many
students prefer these colleges because they offer smaller classes and more personal
attention from teachers.

Teaching and learning

credit minor curriculum major sophomore

9 The US academic year may be divided into two semesters of about 15 weeks or three
quarters of about 10 weeks each. Students take courses in a variety of subjects, regardless
of their main subjects, because the aim of the liberal arts is to produce well-
rounded people with good critical skills. At the end of their (=second) year
students choose a (=main subject) and sometimes a
(=additional subject) which they study for the next two years. Students take four or five
courses each semester from the course catalogue. Courses may consist mainly of lectures or
may include discussion sections or lab sessions.
10 Students are given grades at the end of each course. The highest grade is A; the lowest
is F, which means that the student has failed the course and will not get for
taking it. To check a student’s overall progress, the university calculates a grade point
average (GPA). Students who finish their degree with a high GPA may be awarded Latin
honours, of which the highest is summa cum laude.
 12
lecturers full tutorials practicals compulsory
electives
11 At most British universities the academic year is divided into three terms. Students study
a main subject throughout their degree course, which is usually a mix of
courses and . Teaching methods vary between universities. Most students
have lectures and seminars (=discussion groups) and there are for those
doing a science subject. At some universities students have individual or
supervisions.
12 In Britain a professor is the person in charge of a department or a senior member of staff.
Other teaching and research staff are called . Junior academic staff may be
called research associates.
In the US most people who teach at colleges or universities and have a doctorate are
addressed as professor. professors are senior to associate professors,
assistant professors and instructors. Graduate students working towards a higher degree
may teach undergraduate courses at larger universities. These grad students are called TAs
(teaching assistants). In return, TAs do not have to pay for their own tuition and get a small
amount of money to live on.
Source: Oxford Guide to British and American Culture, OUP (1999), OUP (2005).

II Enter the English equivalents of the following Croatian expressions.

Across
1. Školarina
3. Docent
7. Redovni profesor
8. Asistent
9. Medicinski fakultet
10. Konzultativna nastava
11. Bod koji određeni predmet nosi
Down
1. Prijepis predmeta i ocjena
2. Izvanredni profesor
4. Studentski kredit
5. Prosjek svih ocjena stečenih u
određenom razdoblju
6. Novčana potpora, pomoć
 THE BOLOGNA PROCESS 13

I Skim the text and choose a subheading for each section.

What are the goals of the Bologna Process?
What are the tools of achieving the goals of the Bologna Process?
The implementation of the Bologna Process
What is the Bologna Process?

II Read the text again and underline key information about the Bologna Process

____________________________
The Bologna Process is an intergovernmental cooperation and integration involving 48 European
countries. The Bologna Process was launched in 1999 with the aims to reform higher education
in Europe and to establish the European Higher Education Area (EHEA) by 2010.

____________________________
Firstly, an integrated Europe requires student- and employee-mobility. This means that students
and employees can easily move from one country to another. For students to be mobile,
education systems have to be compatible in different countries of the EU and beyond. For
employee-mobility, a degree earned in one country has to be recognized in another country
where the employee is seeking to be hired.
Secondly, if Europe and the EU want to stay competitive globally, they need to have a strong
education system that produces a creative and innovative workforce. This is especially true in a
labour market that increasingly needs people with high skills. Many of the world's technological
and other types of innovations originate from institutions of higher education, therefore it is very
important to raise the quality of education. A strong education system will attract talented
students and scholars from all over the world, who can further improve the level of education in
the EHEA.

____________________________
The countries that are part of the Bologna Process form the EHEA. Within this area, the
education systems of the member countries had to be made comparable and compatible to
enable the mutual recognition of qualifications earned in different countries. There are a number
of instruments designed to achieve this:
The three-cycle degree structure defines the hierarchy of degrees in the EHEA through the
European Credit Transfer and Accumulation System (ECTS). The first degree is the bachelor’s
degree, which usually takes 3 to 4 years to complete and requires 180-240 ECTS credits. The
second cycle is the master’s degree; it requires 60-120 ECTS credits and takes 1 to 2 years to
complete. The final cycle is the doctoral degree; here the number of ECTS credits or the length of
the course is not defined.
The EHEA covers quality assurance. A mutual recognition of qualifications cannot be achieved
without developing trust among institutions that the quality of education provided is up to a certain
minimum level in all participating institutions. Therefore, the EHEA’s quality assurance measures
ensure that common criteria and methodologies are developed and used in all institutions while
still maintaining the autonomy of institutions.
Finally, the Diploma Supplement makes degrees earned more easily readable and comparable
when applying for further study in another institution or when applying for a job. This document is
issued together with the Diploma and it precisely describes the student’s academic achievements
and competencies (courses taken, grades earned, skills and knowledge learned).

____________________________
Implementing the Bologna Process meant reforming the higher education system in all member
countries. In some countries, the required changes were greater than in others. There are also
countries where students and citizens were not always convinced that the changes were
necessary or that they had been properly implemented. In general, the Bologna Process resulted
in a more transparent education system where student-centred teaching methods, social
inclusivity and international cooperation is valued and encouraged.
 14
III Use this diagram to make notes on the text.

THE BOLOGNA PROCESS

G __ __ __ S
1. __________________________
A) ____________________
B) ____________________
2. __________________________

T__ __ __ S FOR ACH__ __ V__ NG THE G __ __ __ S

1. __________________________

2. __________________________

3. __________________________

PROBLEMS IN I__ __ __ E __ E __ TATION

CONCLUSION

IV Consult your notes and write a short paragraph.

In what ways did the Bologna Process improve higher education in Europe? (What can students
and graduates do today that was not so easy before the Bologna Process started?)
 15
2 ECONOMICS AND ECONOMY
INTRODUCTION

I Study the key terms and do the exercises that follow.

Economics (noun) The study of the way in which wealth is produced and used.

Economy 1 (noun) The system by which a country’s goods and services are produced
and used.
e.g. The transformation from a command economy to a market one.

2 (noun) The careful use of money, goods, time etc. so that nothing is wasted.
e.g. In trying to achieve the economy, the National Health Service is cutting on
its spending.

3 (noun) A way of spending less money, the intentional saving of money, or

less commonly the saving of time, energy, words etc.
e.g. They’ve had to make economies since Collin lost his job.

4 (adjective) An economy fare, hotel etc. is cheaper than other things of the
same type.
e.g. Kuoni Travel offers a range of economy and medium-priced hotels.

5 (adjective) An economy size product or packet contains more than a normal

one and is cheap compared to the normal size product.
e.g. The small-size offerings that used to fill shelves have been replaced with
economy-size packages.

Economist (noun) Someone who studies the way in which wealth is produced and used
in an area.

Economic (1) (adjective) Having to do with the production, distribution and

consumption of wealth and income
e.g. economic development/planning/policy

(2) (adjective) Relating to the science of economics, or to commerce and

industry.
e.g. economic activity /economic theory

Economical (adjective) Using time, money, goods etc. carefully, without wasting.
e.g. Adults generally watch a movie on video once or twice, making it more
economical to rent than to buy .

Economize (AE) /Economise (BE) (verb) To reduce the amount of time, money goods etc.
that you use.
e.g. The company will continue to economize by shedding further 2,000 jobs
this year.

Economies of scale (noun in plural) The advantages that a big factory, shop etc. has over
a smaller one because it can spread its fixed costs over a large
number of units and therefore produce or sell things more cheaply.

(Sources: Longman Dictionary of Business English, Cambridge English Dictionary)

 16
II Solve the puzzle with the words from task I on the previous page.

Across
2. Someone who studies the way in which wealth is produced and used in an area.
3. a) The system by which a country's goods and services are produced and used, or a country
considered in this way. OR
b) The careful use of money, goods, time etc. so that nothing is wasted. OR
c) A way of spending less money.
4. Using money, time, goods etc. carefully and without wasting any.
Down
1. The study of the way in which wealth is produced and used.
2. a) Relating to or involving economics, money, finance. OR
b) Which produces enough profit to make it worth continuing with.
3. To reduce the amount of time, money, goods etc. that you use, to save money.

III Translate the words in italics into English.

1 Gospodarstva of the transition countries have undergone major changes recently.

2 Ekonomija is the system by which a country’s goods and services are produced and
used.
3 The ekonomska situation in Croatia is very serious.
4 Ekonomija is a fascinating subject to study.
5 This production process is very ekonomičan.
6 As businesses grow they may achieve ekonomiju razmjera.
7 The Italian ekonomija is in big problems.
8 A decrease in the gospodarski growth was recorded last month.
9 Some students study ekonomija, while others do business studies.
10 Ekonomije razmjera can arise in several areas: e.g. purchasing, marketing,
administration or research and development.
 17
IV Fill in the gaps with either economics or economy.
1 She studied music at Oxford but after a year switched to politics, philosophy and
.
2 The finance minister favours tax cuts to stimulate the .
3 The slowing global _ has weakened demand for Japan's high-technology
exports.

4 Macroeconomics is the field of _______________ that studies the behaviour of the

_____________ as a whole.

V Fill in the gaps with economic or economical.

1 The word is related to the economy or finances, money matters, or
wealth.
2 refers to avoiding waste.
3 Try to be with the fabric when you cut out the shapes – we haven’t got any
more.
4 There was a rise in unemployment due to the downturn.
5 An car uses a minimum amount of petrol to drive a maximum number of
kilometres.
6 The climate is slowly improving.

VI Fill in the blanks with the words from the box.

ECONOMIC, ECONOMIST, ECONOMICS, ECONOMISE, ECONOMY, ECONOMICAL

1 The country is facing a severe crisis.

2 The climate is not likely to improve significantly this year.
3 He expects Europe’s over the long run to grow faster.
4 What are the prospects for recovery?
5 The system was extremely because it ran on half-price electricity.
6 We have to keep fares high enough to make it for the services to continue.
7 I find the leg room on most flights insufficient.
8 She has a degree in .
9 Consumers are interested in small _cars which do not use a lot of petrol.
10 This region’s _is still largely based on manufacturing.
11 How could the most use of our time be organized?
12 The national is the system of the use and management of a country’s
resources.
13 is the oldest in social sciences.
15 Strikes were damaging the country’s .
16 What has gone wrong with the system?
17 J. M. Keynes was a famous .
18 Choosing your life’s occupation is the most important decision you
will make.
19 The earliest _theories were explanations of how the worked. 18
20 As a scholarly discipline, is two centuries old.
21 The political agenda is full of issues.
22 Many countries tried to on fuel in the 1970s.
23 Some analysis is required here.
24 It is usually more to buy large quantities of a product than small
quantities.
25 She majored in at Harvard.
26 Fourteen top have signed a statement criticising proposed tax cuts.
27 New software was introduced to on management costs.

VII Sort out the words in the box by copying them in the right column.

INTERNATIONAL THEORETICAL KEYNESIAN BOOMING HEALTHY

BLACK CLASSICAL FRAGILE APPLIED GLOBAL

economics economy

VIII Use the above word partnerships in sentences of your own.

 19
WHY ECONOMICS?

I Discuss these questions.

1 Do you think everybody should have some knowledge of economics?

2 In what way do you think knowledge of economics can help people in their lives?
3 What is the difference between economics and business?
4 What do economists do?

II Before reading Why Economics match the words/phrases on the left to the
explanations on the right.

1 issue A impossible to measure, very great

2 affect B an advantage that somebody already has before they start doing
something
3 infinite C to have an influence on something
4 commodity D to happen, to start to exist, to occur
5 a head start E an important topic that people are discussing or arguing about
6 assumption F a physical substance (a raw material, e.g. coffee, bananas,
metals, etc.) which is traded on special markets
7 arise G kept as a prisoner; unable to escape
8 captive H a belief or feeling that something is true / that something will happen,
although there is no proof

III Skim the text adapted from Samuelson’s book Economics* and decide which
paragraphs should be given the following headings. Each heading reflects the main
idea presented in the paragraph.

A Scientific tools and methods

B Scarcity of resources

C Discovering an objective reality?

D Informed voting- civic duty

E Chief interest of economics

F Impact on personal life

G Careful allocation of resources

H Obstacle: clinging to familiar theoretical conceptions

I Research topics in economics

 20
IV Read the text, check your predictions and write the headings on the blank lines.
Then, choose the correct bold-typed words.

1 All your life you will run up against the brutal truths of economics. As a voter, you will make
decisions on issues - on the government budget, regulating industries, taxes and foreign
trade - that cannot be understood until you have mastered the basics of economics.

2 Choosing your life’s occupation is the most important economical / economic decision
you will make. Your future depends not only on your own abilities but also upon how
economic forces beyond your control affect your wages. Also, economics / economy may
help you invest the nest egg you have saved from your earnings. Of course, studying
economics / economy cannot make you a genius. But without this knowledge the dice of
life are simply loaded against you.

What is economics?

3 Economics covers all kinds of topics. But the core is devoted to understanding how society
allocates its scarce / abundant resources.

The law of scarcity

4 Economists study the way goods are produced and consumed because people want to
consume far more than an economy / economics can produce. If infinite quantities of every
good could be produced, people would not worry about the efficient use of scarce resources.
In such an Eden of affluence, there would be no economic / economical goods, goods that
are scarce or limited in supply. There would be no need to economical / economize on
consumption and indeed economics / economy would no longer be a vital science. All
goods would be free, like sand in Saudi desert or water at the beach.

5 So, economics / economy is the science of choice. It studies how people choose to use
scarce or limited productive resources (labour, equipment, technical knowledge), to produce
various commodities (such as wheat, overcoats, concerts, and missiles) and to distribute
these goods for consumption.

How? Why?

6 How could anyone hope to know in a precise and scientific way why economy /
economics of Japan has grown rapidly while the economy / economics of the Soviet Union
has stagnated? Can economists really explain why some people are fabulously rich while
others hardly afford one square meal a day? Of course, economists have no monopoly on
the truth about the important issues of the day. Indeed, many phenomena are poorly
understood and highly controversial.

7 But economists and other scientists have developed techniques – sometimes called the
scientific approach, that give them a head start in understanding the complex forces that
affect economic / economics growth, process and wages, income distribution, and foreign
trade:
 Observation: This is about observing economic affairs, especially historical records:
Why did inflation in Germany in the 1920s, reach 1,000,000,000,000 percent in two years,
destroy the middle class, and, as many think, bring Hitler to power?
 Economic analysis: History and facts are important, but facts cannot tell their own
story. By developing and testing economic / economical theories we can simplify and
organize the jumble of data and facts into a coherent view of reality. That is why economists
use a set of assumptions and then deduce logically certain predictions about the economic
behaviour of people, firms or the overall economy. (There is a wonderful joke about three
men stranded on the deserted island: an engineer, a chemist and an economist. One day a
can of beans washed up on the shore. The hungry men debated how to open it. The
 21
engineer suggested hitting it on the rock, but there was no rock. The chemist suggested to
heat it to great temperature, so it would burst open, but they could not start a fire. Suddenly
the economist announced: “Let’s assume we have a can opener.”
 Statistical analysis: Governments and businesses issue volumes of data that can help
us analyze economic behaviour quantitatively. While actual application of such information
requires advanced tools in probability and econometrics, understanding the results requires
only common sense. Let’s say that you are wondering why, on average, women earn only
60% as much as men. You collect data on wages of men and women, along with their
personal characteristics (education, years of experience, occupation and so forth). You
employ statistical techniques and see that men have on average spent more time in the
workforce and have generally entered higher-paying occupations. But after all the statistical
dust has settled, a significant part of the wage differential is unexplained. Some believe this
remaining differential is due to discrimination.
 Experiments: The economic / economical world is enormously complicated, with
millions of households and billions of prices. Economists are relying more and more on
experiments to explain economic behaviour. For example, in one of group of controlled
experiments over the last two decades, economist measured people’s reactions to different
kinds of government programs to raise the incomes of the poor. Other experiments today
examine how markets behave with a small number of producers.

Subjectivity

8 There are many obstacles to mastering economy / economics but perhaps the greatest
one arises from the subjectivity we bring to studying the world around us. We sometimes
believe that the task of our studies is to uncover an objective reality – to learn the facts and
laws of nature or economics.

9 Unfortunately, learning is not so simple. When we are young, our minds are open to new
ideas. As we grow up, we begin to organize our ideas and to learn about the world from our
family, friends, and teachers. But no sooner do we begin to understand our world than we
become captives of our own knowledge. Scientists are just like other people; they are
prisoners of their theoretical preconceptions. In his Scientific Autobiography, Planck reports
what he observed in the development of physics:
“The experience gave me also an opportunity to learn a fact – a remarkable one in my
opinion: A new scientific truth does not triumph by convincing its opponents and making them
see the light, but rather because its opponents eventually die, and a new generation grows
up that is familiar with it.”
* Samuelson, P.A. Economics, 14th edition, ed. McGraw-Hill, 1992
Samuelson – Nordhaus, Economics, 18th edition, ed. McGraw-Hill, 2005

V Organise the main ideas visually. Refer to pp. 74-76 for advice on making notes.
 22
VI Go back to the text and underline the terms/expressions that primarily belong to
the language of economics and business.

e.g. government budget, foreign trade, etc.

VII Find the words in the text which mean the following:

ekonomija

zanimanje

ekonomski rast

vjerojatnost

nadnice (plaće) _______________

distribucija dohotka

ekonometrija

obilje

vanjska trgovina

radna snaga

ekonomska analiza

oskudni resursi

kućanstva _______________

znanstveni pristup

VI There are several figurative expressions in the text. Match up the half-
sentences below to explain these expressions.

1 If the dice are loaded against you, eat properly at least once a day.

2 To invest the nest egg means you experience difficulty.

3 People who have a square meal a day you are out of control, facing uncertainty
and risk.

4 When you run up against something that you use your savings to increase
your wealth.
 23
3 THE DIFFERENT SECTORS OF THE ECONOMY

I Read the text and underline the key words.

The different sectors of the economy

A nation’s economy can be divided into various sectors to define the proportion of the
population engaged in each sector of economic activity.
The primary sector of the economy extracts, collects or harvests products from the earth,
such as raw materials and basic foods. Activities associated with primary economic activity
include agriculture (both subsistence and commercial), mining, forestry, farming, grazing, hunting
and gathering, fishing and quarrying. The packaging and processing of raw materials is also
considered to be part of this sector.
The secondary sector of the economy produces or manufactures finished goods from
the raw materials extracted by the primary economy. All manufacturing, processing and
construction lie within this sector.
There are different categories of goods depending on who purchases those goods and for
what purpose. Capital goods are sold to other producers. These can either help make other
goods (like machinery in a factory, e.g., a welding equipment) or they can help provide a service
to a manufacturer (e.g., a delivery van). Consumer goods are sold to the final consumer. Some of
these are consumables, which are used up when consumed. Bread is such a product. Consumer
durables, however, last longer, their use does not lead to the disappearance of the product, e.g.,
a TV.
Activities associated with the secondary sector include metal working, automobile
production, textile production, chemical and engineering industries, aerospace manufacturing,
energy utilities, engineering, construction and shipbuilding.
The tertiary sector of the economy is also known as the service industry. This sector
sells the goods produced by the secondary sector and provides services to both the general
population and to businesses in all five economic sectors.
Services are intangible, (i.e., they cannot be touched or held) and are often used up at the
time of consumption. Services can be provided for different categories of customers. Services for
businesses are commercial services which typically help these businesses in the production
process or in the distribution of their goods. The next category of services (direct services) is
provided to consumers, examples to these are hairdressing, restaurant meals, and healthcare.
The third category can be provided to both businesses and consumers, financial services (such
as banking or insurance) are an example to this.
Activities associated with this sector include retail and wholesale sales, transportation and
distribution, restaurants, clerical services, media, tourism, insurance, banking, healthcare and
law.
Although many economic models only divide the economy into three sectors, others divide
it into four or even five sectors. These final two sectors are closely linked with the services of the
tertiary sector. In these models, the quaternary sector of the economy consists of intellectual
activities often associated with technological innovation. It is sometimes called the knowledge
economy.
Activities associated with this sector include government, culture, libraries, scientific
research, education and information technology. These intellectual services and activities are
what drives technological advancement, which can have a huge impact on short- and long-term
economic growth.
Some economists further subdivide the quaternary sector into the quinary sector, which
includes the highest levels of decision making in a society or economy.
Adapted from: Rosenberg, M. (2017) The five sectors of the economy. ThoughtCo. Retrieved
from: https://www.thoughtco.com/sectors-of-the-economy-1435795

II Complete the keywords that are useful when talking about the different sectors of
economic activity.
The primary sector __XTR__CTS, H__RV__STS or C__LL__CTS raw M__T__R__ __LS and
basic F__ __DS. The secondary sector uses these raw materials to PR__D__C__ ,
M__N__F__CT__R__ or C__NSTR__CT finished G__ __DS. The tertiary sector PR__V__D__S
different S__RV__C__S to individuals or businesses. The quaternary sector involves providing
KN__WL__DG__ -based services, while the quinary sector entails the highest levels of
D__C__S__ __N M_K__ING in an economy.
III Make slides that you could use in a presentation on the five sectors of the 24
economy.
Don’t forget: you should not write full sentences on slides, use bullet points instead.

IV Find the terms in the text that mean the following:

1 To pull or take out with force or great effort.

2 To gather a crop when it is ripe; to reap.
3 A basic material from which goods are made.
4 To extract stone or other material from an open excavation or pit.
5 Generation and distribution of electricity, gas, or water to general
public.
6 The work of building something, especially buildings, bridges, etc.
 EMPLOYMENT IN THE DIFFERENT SECTORS OF THE ECONOMY 25

Comparing employment structures

The employment structure of a country shows how the labour force is divided between the
various sectors. Different countries have different employment structures. The employment
structure of a given country can tell you quite a lot about its economy.
In the richest countries, for example, there will usually be more people working in the
tertiary/quaternary sector than in the primary and secondary sectors. In the poorest countries,
there tend to be more people working in the primary sector than in either the secondary or tertiary
sectors.

I Read the text and complete the line graph to show the UK employment structure
from 1800 – 2000. (The beginning and ending figures are provided, but you have to decide
which beginning figure refers to which sector.)

Changing employment structures over time

Employment structures can change over time within the same country.
In the UK in 1800 most people would have been employed in the primary sector. Many
people worked on the land, and made their living from agriculture and related products.
During the industrial revolution, more people were needed to build ships, work in steel
making and with textiles. All of these jobs are found in the secondary sector. By 1900 over half of
the workers in the UK were employed in secondary industries.
Since 1900 mechanisation meant that less people were required to work on the land and
in industry, as machines could carry out most of the work that people previously did.
Foreign industries also became more competitive and imports such as coal became more
affordable. As the availability of coal declined in the UK, and also became more expensive to
extract more coal was imported. This led to a further decline in primary sector employment in the
UK.
The demand for work increased in schools, hospitals and retail industries. Many people
left the rural areas in the search for jobs in the towns and cities. By the year 2000 over half of the
UK workforce were employed in tertiary industries and only a small number were employed in
primary industries. This has changed the work that people do, and also where they work.
Quaternary industries are a relatively new concept, and it is only recently that they have been
added to these figures. However it is becoming an important and growing sector in the UK as
many firms want to carry out research and development for their products.

Line graph to show the UK employment structure from 1800 – 2000

Source: Geography, Characteristics of Industry. BBC: GCSE Bitesize. Retrieved from:
http://www.bbc.co.uk/schools/gcsebitesize/geography/economic_change/characteristics_industry_rev2.shtml
II Find the terms in the text that mean the following: 26

1 The rapid development of industry that occurred in Britain in the late

18th and 19th centuries, brought about by the introduction of
machinery.
2 The process of starting to use machines to do something that was
previously done by hand
3 A term describing businesses that sell goods directly to individuals.
4 The group of people who work in a company, industry, country, etc.

III Match the definitions of companies with the corresponding industries.

1 A company which makes aspirin. a) automotive
2 A company which mines diamonds. b) construction
3 A company which makes men’s suits. c) consumer electronics
4 A company which sells package holidays. d) financial services
5 A company which makes trucks. e) confectionery
6 A company which distributes electricity. f) software
7 A supermarket chain. g) telecommunications
8 A company which builds houses. h) media
9 A company which makes washing machines. i) pharmaceuticals
10 A company which sells hamburgers. j) beverages
11 A company which makes TVs. k) textiles
12 An airline. l) toiletries
13 A company which makes fighter planes. m) real estate
14 A company which makes shampoo. n) transport
15 A restaurant chain. o) utilities
16 A newspaper publisher. p) household goods
17 A company which sells things over the internet. q) retail
18 A company which makes mobile phones. r) fast food
19 A company which sells investment advice. s) catering
20 A company which makes chocolate. t) defence
21 A company which makes beer. u) e-commerce
22 A property company. v) tourism
23 A company which writes computer programmes. w) extractive

Source: Steve Flinders: Professional English (Business Intermediate)

IV Say which sector each industry belongs in.

TEST YOUR KNOWLEDGE

I Fill in the gaps with the correct form of the missing words.
1 Rubber latex is _________________ from rubber trees.
2 The forest provides ________ ____________ for wood based industries.
3 The sun is a source of renewable energy. Solar panels _________________ electricity.
4 A successful business _________________ a service that makes people’s lives better.
5 The government _________________a decision to extend the road network to reach all parts
of the country. The _________________of this road system took 12 years and $12 billion.
6 Hydroelectric water is currently the leading renewable energy source used by electric
_________________ to generate electric power.
7 One of the reasons why the _________________ is shrinking (less and less people are
employed) in the primary sector today is that a lot of the work is done by machines, e.g., coal
handling was _________________ and automated.
II Explain the following terms in your own words. 27
capital goods
____________________________________________________________________________
consumer goods
____________________________________________________________________________
consumables
_____________________________________________________________________________
consumer durables
_____________________________________________________________________________
intangible
_____________________________________________________________________________
commercial services
_____________________________________________________________________________
direct services
_____________________________________________________________________________
employment structure
_____________________________________________________________________________

III Solve this multiple choice test.

1. What is secondary industry? 5. Tertiary activity refers to employment in:

A) Where a farm makes a lot of money, A) extractive industries.
to set up another farm B) manufacturing industries.
B) When natural resources are C) service industries.
processed and turned into a D) improving industries.
product E) employment industries
C) When a farm or factory is making a
loss and has to shut down
D) When a company is not making
enough profit

2. Which sector employs the most people 6. Which of these jobs is part of the
in the UK? quaternary sector?
A) Tertiary / Quaternary A) Research and development
B) Secondary B) Forestry and fishing
C) Primary C) Selling goods and services
D) Modernity D) Rearing animals and growing crops
E) Mining and quarrying
3. What is the employment structure of a
country?
A) It is the amount of people employed
there. 7. In Nepal the highest percentage of people
B) It is the amount of people who live work in which sector?
there. A) Primary
C) It is the wealth of the country. B) Secondary
D) It is the types of jobs that people do. C) Tertiary
E) It is a measure of how industrialised D) Quaternary
a country is.

4. What are the key areas of employment

in the primary sector?
A) Farming, mining and fishing 8. In the richest countries more people work in
B) Construction and building which sectors?
C) Manufacturing and production A) Primary and secondary
D) Banking and financial services B) Primary and tertiary
E) Teaching, education and schools C) Tertiary and quaternary
D) Secondary and tertiary

Source: Geography. Economic change. Characteristics of Industry. Test. BBC: GCSE Bitesize. Retrieved from:
http://www.bbc.co.uk/bitesize/quiz/q29711656
 28
Where did all the jobs go?

I Read the text below to find out about employment trends globally. Take the
following steps:
a) Read and underline the topic sentences
b) Read the topic and the last sentences
c) Read the whole text paragraph by paragraph.

From the 1750s to the middle of the nineteenth century, Britain led an industrial revolution
that changed manufacturing forever. With other Western countries, it produced consumer
goods for the rest of the world well into the 1960s. Generations of workers spent their entire
careers in the same workplace. Yet, nowadays, most of the consumer goods we buy have
been made in the East. If, by magic, our shoes could return to where they were made, most
would march all the way back to China or Vietnam – and the jobs have gone with them.
Manufacturing gravitates to countries with lower labour costs, or more efficient production
methods. Since the US economy started to recover in 2003, unemployment has remained
high. This is because two million manufacturing jobs have gone elsewhere.
China is undoubtedly the latest big success story. As well as making 90% of world’s toys, the
country is now responsible for a quarter of global steel production. By contrast, much of the
US’s industrial heartland has been a “rust-belt” for years. In Western Europe, too, industry
has been declining for decades. European shipyards have been closing one by one ever
since South Korean rivals learnt how to build more efficiently and cheaply. Nearly all Britain’s
coal mines have ceased production since it became cheaper to ship coal all the way from
Australia. Since the 1980s, tens of thousands of British workers have lost their jobs in these
sectors.
Some workers may have retrained and found jobs in hi-tech industries; however, most have
ended up working in services. In the UK, more people are now employed in making
sandwiches than in making steel. Even jobs in knowledge-based services are threatened by
globalization. Improvements in telecommunications have allowed firms to outsource work
thousands of miles away. Bangalore, with its workforce of highly-skilled computer
programmers and engineers, has transformed itself into India’s answer to Silicon Valley.
Many UK businesses have relocated their call centres there too – an Anglophone Indian
worker will work for a fraction of his British counterpart’s salary. This all proves that even
though employment in hi-tech sectors such as pharmaceuticals and aeronautics remains
strong, for most of us the idea of a job for life – or at least a safe job - has been untrue for
years.
Source: Jon Nauton, Profile 2, OUP

II Make notes of the text in your notebook. Use the following headings.

MANUFACTURING GROWS IN THE EAST

EXAMPLES OF GROWTH IN THE EAST:

INDUSTRY → COUNTRY 1), 2), 3)
REASONS

MANUFACTURING JOBS DECLINE IN THE WEST

EXAMPLES : 1), 2), 3)
CONSEQUENCES: 1), 2), 3)

LOSS OF JOBS IN KNOWLEDGE-BASED INDUSTRIES

1)
2)

III Use the notes to practise retelling the text.

 29
4 THE THREE TYPES OF ECONOMIC SYSTEMS

I Read the following text and answer these questions.

1 What is the basic economic problem?
2 How is it solved in the three types of economic systems?

The function of an economy is to allocate scarce resources amongst unlimited wants and to
solve the basic economic problem which is often broken down into 3 questions:
What should be produced? How should it be produced? For whom should it be
produced?
How the above questions are answered will depend on the type of economic system: the free
market economy, the planned economy and the mixed economy. The way business activity
is organised will be different in each of the systems.

MARKET ECONOMIES
In market economies (also known as capitalist economies or free market economies)
resources are allocated automatically by the forces of demand and supply (market
mechanism), which stimulates competition. This should lead to lower costs, a wider choice of
goods and services and better quality for consumers. The role of government in a free market
system is limited. Some of its main functions are to pass laws, to provide certain essential
products and services such as policing, national defence and the judiciary, and to ensure a
level playing field (fair competition) for all competitors. In market economies, market
imperfections can occur. Some goods and services are not provided by private firms such as
defence. Furthermore, private firms are not interested in services which do not make a profit.
Another implication of the working of a free market economy is that firms may choose to
sacrifice public interest in exchange for lower costs.

PLANNED ECONOMIES
Government has a vital role in a planned economy (also known as command economy). It
plans, organises, and co-ordinates the whole production process. This is unlike a market
economy, where planning an organising is carried out by firms. Planners encourage the
production of standardised goods with little variety and choice for consumers. Another
difference is that resources in planned economies belong to the state, and goods and services
are distributed to consumers by the state. In planned economies, there tends to be a more
equal distribution of wealth and income, production is for need rather than profit, people tend
to be less motivated to work efficiently and the standard of living is often lower compared with
countries which use other types of economic systems.

MIXED ECONOMIES
In reality, no country has an economy which is entirely planned or free market. Most
economic systems in the world have elements of both. They are known as mixed economies.
In mixed economies some resources are allocated by the government (in the public sector)
and the rest by the market (in the private sector). In mixed economies the state usually
provides a minimum standard of living for those unable to work. The public sector is
responsible for the supply of some public goods and services and this is decided by central
or local government. Public goods are usually provided free when used and are paid for by
taxes (e.g. roads). In the private sector production decisions are made by firms in response
to the demands of consumers, and individuals are allowed to own the means of production.
One of the roles of the government is to ensure that there is fair competition in the private
sector. All private goods and services are allocated as in the market system.
Adapted from: D. Hall, R. Jones, C. Raffo: Business Studies, 2nd ed., 2000, Causeway Press Limited
 30
II Make notes on the text with the help of this table.

Mixed economy
Market Planned
economy economy Public sector Private sector

Role of the
government

Ownership of
resources

Allocation of
resources

Competition

Advantages

Disadvantages

III Make word partnerships from the two columns below and copy them in the
third column.

1 unlimited sector

2 scarce goods

3 basic mechanism

4 market distribution

5 standardized wants

6 income economic problem

7 public/private resources
 31
IV Find the words in the text which match the definitions below.

1 An exchange mechanism that brings together sellers and buyers of

a product, factor or production.
2 Goods and services provided by a government for the benefit of all
or most of the populace.
3 The choosing of the particular use to which a scarce resource
(means of production) is put, e.g. whether to use water for electric
power or crops
4 Raw materials and means of labour (tools, machines, etc.)
employed in the production process
5 Products that are the same because they satisfy the same
technical requirements.
6 The branch of government that includes courts of law and judges
7 The inability of markets to deliver goods or services.
8 The level of wealth, comfort, material goods and necessities
available to a certain socioeconomic class in a certain geographic
area.
9 An organized way in which a state or nation allocates its resources
and apportions goods and services in the national community.

V Fill in the grammatically correct version of the missing verbs to establish

word partnerships.

The government:
1 resources in a planned economy.
2 laws in all three types of economies.
3 only essential goods and services in a market economy.
4 fair competition in a market economy.
5 , , the production process in
a planned economy.
6 income more equally in a planned economy.

VI Find synonyms for these terms in the text.

1 market economy:
2 planned economy:
3 forces of supply and demand:
4 means of production:
5 rivalry:
6 level playing field:
7 insufficient, limited:
 32
REVISION 1
University Essentials, The Bologna Process, Economy and Economics, Sectors of
Economic Activity, The Three Types of Economic Systems

I Read through this list of terms and decide which terms belongs to which unit. Some
might fit in more than one place.
scarce resources, primary sector, national defense, graduate, system of credits, undergraduate,
economics, dean, Bachelor's degree, quinary sector, economy, role of the government, private
sector, raw materials, Master's degree, ECTS, capital goods, standardized goods, major, tertiary
sector, elective course, consumer goods, utilities, student mobility, full-time student, Diploma
Supplement, level playing field, extract, part-time student, quaternary sector, sign up for an exam,
economic, tuition fee, student-faculty ratio, 3 cycle degree structure, public sector, the European
Higher Education Area, harvest, distribution of wealth, economies of scale, secondary sector,
employment structure, market economy, forces of demand and supply, economic system,
standard of living

University Essentials

The Bologna Process

Economy and Economics

Sectors of Economic Activity

The Three Types of Economic

Systems

II Look at the words in task I again and …

a) explain their meaning in your own words.
b) use each in a sentence.
 33
III Explain the difference between the following concepts:

1 graduate student / undergraduate student

2 Bachelor's degree / Master's degree

3 compulsory course / elective course

4 tuition fee / scholarship

5 student loan / government grant

6 athletic scholarship / merit-based scholarship

7 letter of reference / letter of application

8 economics / economy

9 secondary sector / tertiary sector

10 quaternary sector / quinary sector

11 the employment structure of the UK in 1900 / the employment structure of the UK in 2000

12 the extractive industry / the pharmaceuticals industry

13 capital goods / consumer goods

14 consumable goods / consumer durables

15 commercial services / direct services

16 market economy / planned economy

17 employment structure / standard of living

18 private sector / public sector

 34
5 THE PUBLIC SECTOR

I Study the differences between the public and the private sector.

THE PUBLIC SECTOR THE PRIVATE SECTOR

 means government ownership for the  means private ownership by private

benefit of everyone individuals
 includes public corporations,  includes businesses that are run for
municipal enterprises, etc. the benefit of the people who own them
 contains the army, the police force,  contains almost all businesses
most schools and hospitals, etc.

II Read the text and choose a heading for each paragraph:

What is the public sector?
What does the public sector contain?
Public goods
Merit goods
Privatization

The public sector is made up of organizations which are, directly or indirectly, owned or
controlled by central or local government. They are funded by the government and in some
cases from their own trading “surplus” or profit.

Certain public goods and merit goods are provided by the public sector. Public goods are
goods where consumption by one person does not reduce the amount available to others
and, once provided, all individuals will benefit (e.g. street lighting).

It is sometimes argued that the public sector should also provide merit goods. Examples
include education, health and libraries, in other words, services that may not be available to
all individuals if not provided by the state. If the individual is left to decide whether or not to
pay for these goods, some would choose not to or may not be able to. The provision of merit
goods is said to raise society’s standard of living.

The public sector consists of different organizations of various size. State-owned enterprises
(also called public corporations), are businesses that are partials or wholly owned by the
government and their purpose is to carry out commercial activities on behalf of the
government. Some of these are very large, and can include some public utilities (e.g.
electricity) or transportation systems. Other examples include, nationalized industries, local
authority services (e.g. municipal services), central government departments, government
agencies, etc..

The public sector has an important role to play in certain areas of business activity yet,
for various reasons, some public sector businesses have been privatized, i.e., transferred
from the public to the private sector. A more recent trend is when through outsourcing public
sector organizations engage private sector enterprises to deliver goods and services to its
citizens.
Adapted from: D. Hall, R. Jones, C. Raffo: Business Studies 2nd edition, 2000, CPU

III What are the terms defined below?

Companies previously owned by private owners which were taken into
public ownership
Goods which are underprovided by the private sector and are sometimes
supplied by the state.
A business enterprise, such as a public service corporation, performing an
essential public service (e.g. electricity, railroads) and regulated by the central
or local government.
 35
IV Identify all expressions in the text collocating with “public”:

public public
public public

PUBLIC GOODS

Public goods are goods and services provided by the state that can be consumed by everybody
in a society. They are both non-rival and non-excludable.
Find the definition of these concepts in the reading.
non-rival: _________________________________________________________________

non-excludable: ____________________________________________________________

V Fill in the gaps with the correct form of the words in the box.

taxation, manage, fee, cooperation, free

Most public goods are ______________ by the government and are provided ______________
at the point of use and then paid for out of general _____________ or another general form of
charge such as a license _____________. Some public goods are managed by private firms
(such as sanitation infrastructure). Because public goods are non-excludable, firms cannot
charge people to use them, which means that such management of public goods is a
______________ between the government and the private sector.

VI Fill in the gaps with the words in the box.

market, free, expensive, subsidize, subsidized, private, social

MERIT GOODS
Goods or services provided free or cheaply for the benefit of the entire society by a government.
Governments _____________ these goods and services or provide them _____________ at the
point of use because they would be too _____________ and therefore under-consumed if left to
the _____________forces. Consumption of merit goods is believed to generate positive
externalities- where the _____________ benefit from consumption exceeds the
_____________benefit, e.g.: compulsory vaccination of children, _____________ housing, higher
education, the opera.

VII Solve the puzzle by entering the verb versions of the nouns below.

Across
3. ownership
6. decrease
8. inclusion
9. argument
10. transfer

Down
1. choice
2. provision
4. decision
5. reduction
7. exclusion
 36
THE ROLE OF GOVERNMENT

I Read the following extract from a talk by J.K. Galbraith and answer this
question:

What areas does Galbraith describe as responsibilities of the state?

The Good Life Beckons

The good society accepts the basic market system and its managers, but there are
some things the market system does not do either well or badly. In the good society
these are the responsibilities of the state.

Some areas of state action are evident. In no country does the market system provide good
low-cost housing. This is a matter of prime importance and must everywhere be a public
responsibility. Few things are more visibly at odds with the good society than badly housed
or homeless people.

Health care is also a public responsibility in all civilized lands. No one can be assigned to
illness or death because of poverty. Here Britain can proudly point to its leadership.

The state has many other essential functions. It must also be borne in mind that many of
these - parks and recreational facilities, police, libraries, the arts, others - are more needed
by the underclass than by the affluent. Those who attack the services of the state are usually
those who can afford to provide similar services for themselves.

In the good society, there must also be attention to a range of activities that are beyond the
time horizon of the market economy. This is true in the sciences, not excluding medical
research. The market system invests for relatively short-run return. To support science is
pre-eminently the responsibility of the state.

Some of the truly important industrial achievements of recent generations - the great
improvements in agricultural productivity, modern air transport, advanced electronics - have
depended heavily on such public investment. Necessary also - a matter we are beginning
reluctantly to recognize - is investment and regulation in the longer-run interest of the
environment. The good society protects and improves life in its planetary dimension.

(From New Statesman and Society)

II Read the text again and answer these questions:

1 Read the definition of the welfare state: “A political system based on the premise that the
government has the responsibility for the well-being of its citizens, by ensuring a minimum
standard of living for everyone.” What is the term that Galbraith uses for the same concept?

2 According to Galbraith, what are the responsibilities of the state?

3 Which of these serve short-term goals, and which long-term goals?

4 Why, according to Galbraith, is the market system not sufficient to guarantee scientific
research?
III Now read the text written by Milton and Rose Friedman about the role of the 37
government (MK, p. 110) and answer these questions:
1 What do the Friedmans think about the role of the government?
2 If Galbraith and the Friedmans had a debate about the welfare state, who would be FOR and
who would be AGAINST?

IV List the advantages and disadvantages of the welfare state. Don’t forget to
use both texts in the unit.

WELFARE STATE

PRO CON

V Work in groups. Use what we have learned about the three types of
economic systems and the role of the government.

HUMANS HAVE FINALLY CONQUERED MARS!

You are a group of economists responsible for designing a

new economic system that will be implemented on Mars.
What should the role of the government be?
Make arguments for your system. Listen to the other
groups and find counter-arguments.

Use phrases such as:

In my view …
In my opinion …
I (don’t) agree with you, because …
 38
TAXATION

How to talk about taxes – Vocabulary focus

I Make two groups from the following verbs:

levy (levies, levying, levied) a tax on sg, impose a tax on sg, be liable to pay a tax,
evade a tax, collect a tax, file a tax return, avoid a tax,
raise revenue through taxation, pay a tax on their income

The government can… People or companies can …

II Fill in the gaps with the verbs and prepositions from above.
1 People __________ an income tax __________ their wages.
2 Certain profits __________ liable __________ a capital gains tax.
3 Customs duties are __________ on imports.
4 The government __________ a tax __________ inheritances. It is called an inheritance tax.
5 The government accused Nokia of __________ tax, but the company disputed the claim.
6 I forgot to __________ my tax return! I’m afraid I’ll be fined by the Tax Office.
7 To ___________ tax, it is usually not enough to simply move one's assets to a tax haven.

Classification of taxes

1) Depending on the tax rate:

Progressive tax / regressive tax / proportional (or flat) tax

 A tax levied at a higher rate on higher income is a ________________ tax

For example, ____________________________________________________________
 A tax that takes a larger percentage of income from low-income people than from high-income
people. It is generally a tax that is applied uniformly. This means that it hits lower-income
individuals harder. This type of tax is called a ________________ tax.
For example, ____________________________________________________________
 A system that taxes everyone at the same rate, regardless of their income bracket.
Supporters of a this type of tax argue that it gives people incentive to earn more, because
they are not penalized by moving up to a higher tax bracket (as they would in a progressive-
rate system). This type of tax is called a ________________ tax.
For example, ____________________________________________________________

2) Depending on who or what is being taxed

Direct tax / indirect tax

 A tax placed directly on an individual or business is a ________________ tax

For example, ____________________________________________________________

 ________________ taxes are levied on the production or consumption of goods and services
or on transactions, including imports and exports.
For example, ____________________________________________________________

III Do the exercises in MK, p. 112 and find examples for each tax category.
 Tax morale and tax compliance: what we can learn from Greece 39

I Do the exercises in MK, p. 112 and then explain what the following terms
mean.
government debt public spending
tax evasion – tax avoidance regressive tax – progressive tax
budget deficit – budget surplus a loophole in the tax law

II Read the text and match the headings with the paragraphs.
A Tax evaders are not punished. E Tax morale: why it is high in some
countries.
B Introduction: the problem with Greece F Tax morale: why it is low in some
countries.
C Cultural change needs to precede tax G Tax evasion in Greece and its
reform consequences.
D The Greek government’s solution H The vicious circle of tax evasion.

Dodger Mania
1
Greece is a fairly small country, but for the past year it has been causing an awfully big uproar.
Burdened by a pile of government debt that could force it into default (and the European banking
system into a meltdown), Greece has had to adopt ever more stringent austerity plans in order to
secure a bailout from the European Union. Explanations of how Greece got in this mess typically focus
on profligate public spending. But its fiscal woes are also due to a simple fact: tax evasion is the
national pastime.

2
According to a remarkable presentation that a member of Greece’s central bank gave last fall, the gap
between what Greek taxpayers owed last year and what they paid was about a third of total tax
revenue, roughly the size of the country’s budget deficit. The “shadow economy”—business that’s
legal but off the books—is larger in Greece than in almost any other European country, accounting for
an estimated 27.5 per cent of its G.D.P. (In the United States, by contrast, that number is closer to
nine per cent.) And the culture of evasion has negative consequences beyond the current crisis. It
means that the revenue burden falls too heavily on honest taxpayers. It makes the system unduly
regressive, since the rich cheat more. And it’s wasteful: it forces the government to spend extra money
on collection (relative to G.D.P., Greece spends four times as much collecting income taxes as the
U.S. does), even as evaders are devoting plenty of time and energy to hiding their income.

3
Greece, it seems, has struggled with the first rule of a healthy tax system: enforce the law. People are
more likely to be honest if they feel there’s a reasonable chance that dishonesty will be detected and
punished. But Greek tax officials were notoriously easy to bribe with a fakelaki (small envelope) of
cash. There was little political pressure for tougher enforcement. On the contrary: a recent study
showed that enforcement of the tax laws loosened in the months leading up to elections, because
incumbents didn’t want to annoy voters and contributors. Even when the system did track down
evaders, it was next to impossible to get them to pay up, because the tax courts typically took seven to
ten years to resolve a case. As of last February, they had a backlog of three hundred thousand cases.
4
40
It isn’t just a matter of lax enforcement, though. Greek citizens also have what social scientists call
very low “tax morale.” In most developed countries, tax-compliance rates are much higher than a
calculation of risks would imply. We don’t pay our taxes just because we’re afraid of getting caught; we
also feel a responsibility to contribute to the common good. But that sense of responsibility comes with
conditions. We’re generally what the Swiss behavioural economist Benno Torgler calls “social
taxpayers”: we’ll chip in as long as we have faith that our fellow-citizens are doing the same, and that
our government is basically legitimate. Countries where people feel that they have some say in how
the state acts, and where there are high levels of trust, tend to have high rates of tax compliance. That
may be why Americans, despite being virulently anti-tax in their rhetoric, are notably compliant
taxpayers.

5
Greeks, by contrast, see fraud and corruption as ubiquitous in business, in the tax system, and even in
sports. And they’re right to: Transparency International recently put Greece in a three-way tie, with
Bulgaria and Romania, as the most corrupt country in Europe. Greece’s parliamentary democracy was
established fairly recently, and is of shaky legitimacy: it’s seen as a vehicle for special interests, and
dedicated mainly to its own preservation. The tax system had long confirmed this view, since it was
riddled with loopholes and exemptions: not only doctors but also singers and athletes were given
favourable rates, while shipping tycoons paid no income tax at all, and members of other professions
were legally allowed to underreport their income. Inevitably, if a hefty chunk of the population is
cheating on its taxes, people who don’t (or can’t, because of the way their income is reported) feel that
they’re being abused.

6
The result has been a vicious circle: because tax evasion is so common, people trust the system less,
which makes them less willing to pay taxes. And, because so many don’t chip in, the government has
had to raise taxes on those who do. That only increases the incentive to cheat, since there tends to be
a correlation between higher tax rates and higher rates of tax evasion.

7
Even while dealing with protests and open riots, the new Greek government is trying to change things.
It is rationalizing its tax-collection system. It has simplified taxes and done away with some of the
loopholes. And it has stepped up its enforcement efforts in ways large and small—tax officials have,
for instance, been sending helicopters over affluent neighbourhoods looking for swimming pools, as
evidence of underreported wealth. These efforts have made some difference: the self-employed seem
to be reporting more of their income, and the evaders have had to step up their game. (There’s now a
burgeoning market in camouflage swimming-pool covers.)

8
But a social inclination toward tax evasion, once established, is hard to eradicate. One fascinating
study, by the economist Martin Halla, showed that tax morale among second-generation American
immigrants reflected their country of origin. And getting tough can backfire. Research suggests that
overemphasizing enforcement can actually weaken tax morale, by making taxpaying seem less like a
freely chosen part of the social contract. The reason tax reform will be such a tall order for Greece, in
sum, is that it requires more than a policy shift; it requires a cultural shift. Pulling that off would be
quite a feat. But the future of the European Union may depend on it. ♦

Adapted from: James Surowiecki, “The Financial Page: Dodger Mania”, The New Yorker, July 11, 2011

III Answer these questions.

1 What are the two reasons for Greece’s fiscal problems?
2 How much money goes unpaid by Greek taxpayers?
3 What does the author mean when he writes that Greece’s tax system is
“unduly regressive”?
4 Why don’t Greeks pay taxes? Give two reasons.
5 How is the tax morale of Americans and Greeks different?
6 Does the author of the article think that the Greek government will solve the
problem of tax evasion easily? Why?
IV Use the mind map to make notes of the text. 41
 VOCABULARY FOCUS 42

I Find terms for these definitions in the text.

1 To be unable to repay a loan.

2 A government’s efforts to reduce public spending to try to shrink

budget deficits.
3 The act of offering financial assistance to a failing business or
economy to prevent it from going bankrupt.
4 Businesses offering legal goods and services but not paying taxes
on their income.
5 Ensuring obedience to the law.

6 The income that is gained by governments through taxation.

7 A legal system for assessing and collecting taxes in a country.

8 How much taxpayers obey the tax laws of a country.

9 Freedom from a certain tax usually given by governments to

encourage some types of activities or businesses.

III Find word partnerships with “tax” in the article.

TAX E TAX M

TAX R TAX C

TAX S TAX E

TAX O TAX R

TAX L TAX R

IV Use some of the word partnerships to fill in the gaps in these sentences.

1 Tax__________________ is illegal, tax avoidance is legal.

2 The country is not collecting enough in tax __________________ so there is not enough
money in the budget for education and health care.
3 Most countries have a progressive income tax __________________.
4 Tax __________________ are responsible for enforcing the tax __________________.
5 In countries where tax __________________ is low, tax __________________ is also
low, i.e., people do not pay their taxes and they are often proud of having evaded the
highest possible amount of taxes.
6 There is a tax __________________ on gifts and inheritances in Croatia. My
neighbour didn’t have to pay anything when he inherited his grandmother’s house.
7 According to many economists, the country should carry out a tax __________________:
VAT and income taxes should be reduced. They argue that lower tax ________________
would encourage investment and entrepreneurship and would also reduce the number of
people who cheat on taxes.
 43
PRIVATIZATION

I Discuss the following questions about privatization. Then match the

questions to the paragraphs below which answer them.

1. What is privatization? PARAGRAPH

2. Is this a new idea? PARAGRAPH
3. How is denationalization accomplished? PARAGRAPH
4. Why privatize? PARAGRAPH
5. Does it work? PARAGRAPH
6. What's the downside? PARAGRAPH
B) Most available evidence shows
A) It depends on the individual D) Initially, privatization
that privatization increases a
country and company. Former company's efficiency. The World can lead to widespread
members of the Soviet Bloc, in Bank’s International Finance Corp. layoffs of workers, as the
order to leap from socialism as affiliate reports that 67% of the new owners clean house
quickly as possible, typically companies it has helped privatize to increase profits.
have simply given away big now report “good“ profitability, up
chunks of state enterprises to from 29% when they were still However, proponents
state-owned. argue that an effective
citizens, in what is known as
“mass privatization“. privatization program can
provide more jobs over the
A common technique is to issue long term because of its
vouchers to the general public positive impact on the
that can be exchanged directly overall economy.
for shares in a privatizing C) Government planners try to
company. achieve a number of goals through
privatization, some of them
Often, the citizens elect to sell contradictory. An oft-stated aim is to
their shares to investment wring more efficiency out of the E) Not exactly.
companies, which then exercise enterprises being privatized, and Governments have been
great control over the company. thus to make the economy in general privatizing their activities in
In other cases, the state turns more productive. one form or another for
over ownership directly to the centuries. Back in 1492,
workers and managers of a Governments also use privatizations Queen Isabella and King
factory or store. In capitalist to raise capital. Unfortunately, since Ferdinand of Spain hired a
countries, privatizations tend to buyers are willing to pay more for a private contractor to seek
occur either through auctions or monopoly, sometimes the goal of an alternative route to
broad public stock offerings. raising money gets in the way of India - though nobody
Some countries, in a twist on making a company more efficient. called it privatization.
the mass privatization concept, Another aim of privatizing,
have also endeavoured to put particularly in developing nations, is
stock in the hands not only of to invigorate and expand local F) In the broadest sense,
wealthy investors, but also of capital markets and to attract foreign privatization means relying
lower-income people. Chile capital. less on government to
came up with an unusual, and meet people's need for
highly praised, plan to allow goods and services, and
workers to convert their vested more on private
pension interest into shares of institutions such as the
privatized companies. marketplace, the family
and voluntary
organizations.
Source: The Wall Street Journal
 44
ARGUMENTS FOR AND AGAINST PRIVATIZATION

I Fill in the gaps with the words from the boxes.

union, diversify, intervention, providing, Financing, protect,

efficient, own, revenue laying, profit, owned

1 “Industries will become more 7 “When industries become more

__________ if they are subjected to the efficient, they often do so by closing
«disciplines of the market», that is the down a plant and _________ off
fear of being taken over or of workers.“
bankruptcy.“

2 “Private firms will be able to 8 “In pursuit of____________, private

___________ into new areas of firms may engage in activities that are
business and take up new business not necessarily in the public interest
opportunities, whereas in the past they instead of concentrating on those
were limited in scope by the Acts of services they were set up to provide. “
Parliament that established them.“

3 “The managers of the businesses will 9 “Once in the private sector, businesses
be free from the _______________ of will be more interested in profit than in
government ministers.“ ____________ services for broader
economic and social reasons, which
can be guaranteed by state control.“

4 “If there is competition there will be 10 “If trade unions are weakened by
alternative suppliers so trade privatization, they may not be able to
___________ power within the old state ____________ workers' interests in
owned industries will be reduced. “ the event of new working practices
being adopted. “

5 “Selling shares in essential 11 “State ____________ industries

industries expands the number of already belong to all the people in the
people in the country who country who, therefore, already have
____________ shares and who, an interest in the prosperity of these
therefore, have a greater interest in concerns and in the services they
the prosperity of these concerns.“ provide.“

6 “Selling the state owned industries 12 “State owned enterprises can only be
raises ____________ for the sold once. _____________
Government.“ government spending in this way is like
‘selling the family silver to pay the
butcher's bill.’ “ (Lord Stockton).

II Which side of the table contains arguments FOR and which arguments
AGAINST privatization?
 SUMMARY 45
I Complete the keywords for the topic of privatization.

1 state owned __NT__RPR__S__S 9 M__SS privatization

2 issue V__ __CH__RS 10 sell SH__R__S
3 broad P__BL__C stock __FF__RING 11 A __CT__ __NS
4 increase __FF__C__ __NCY 12 increase PR__F__T__B__L__TY
5 protect workers’ __NT__R__STS 13 R__ __S__ capital or R__V__N__ __
6 expand local C__P__T__L markets 14 attract F__R__ __GN capital
7 L__Y __FF workers 15 D__V__RS__FY
8 M__K__ the economy more PR__D__CT__V__

II Make notes on what you have learned about privatization. Make sure that
you use all of the keywords from above.

1. What is privatization?

2. Why do governments privatize?

3.What are the different ways in which privatization has been done around the world?

4. Arguments for privatization: (add your own if possible)

5. Arguments against privatization: (add your own if possible)

 46
THE PENDULUM OF CONTROL

I Fill in the gaps with the words from the box.

marketplace exploited reducing wages interference jobs central

planners investors collapsed create needs communist Eastern at
market incomes wages privatized enterprises Central
government’s market voters planning

Every nation grapples with a fundamental economic issue: Should the government determine
economic outcomes, or should society rely instead on «the market» to fashion economic results?
Historically, the pendulum of control has swung in both directions. The eighteenth – century economist
Adam Smith argued that nations would prosper with less government (1) _ _ and more
reliance on the «invisible hand» of the (2) . As he saw it, markets were efficient
mechanisms for deciding what goods to produce, how to produce them, and what (3)
_to pay. Smith's writings (The Wealth of Nations, 1776) encouraged governments to
take a more passive role in «the business of business. »
Karl Marx saw things differently. In his view, a freewheeling marketplace would cater to the whims of
the rich and neglect the (4) of the poor. Workers would be (5) __ by industrial
barons and great landowners. To «leave it to the market», as Smith had proposed, would encourage
exploitation. In the mid–nineteenth century, Karl Marx proposed a radical alternative: overturn the
power of the elite and create a (6) _ state in which everyone's needs would be fulfilled.
Marx's writings (Das Kapital, 1848) encouraged communist revolutions and the development of (7)
_ planning systems. The (people's) government, not the (8) _ _, assumed
responsibility for deciding what goods were produced, (9) what prices they were sold,
and even who got them.
The choices have not always been so dramatic. In the history of the United States there haven't been
any «all-or-nothing» transformations like those in Russia, China, Cuba, Burma, or Eastern Europe.
The alternatives of government control or market reliance have been a question of degree, not
revolution. The New Deal was about as big a change as America has experienced. In the depths of
the Great Depression of the 1930s, President Franklin Roosevelt greatly expanded the (10)
_ role in providing income security, regulating working conditions, and limiting the power
of large corporations. The English economist John Maynard Keynes (The General Theory of
Employment, Interest and Money, 1936) also encouraged governments both here and abroad to play
a more active role in (11) _ _ unemployment.
The pendulum of control hasn't always swung in the direction of more government. In the 1990s, the
central (12) _ systems of (13) _ and (14) Europe were largely
dismantled. As communism (15) , people in Russia and Eastern Europe turned to
the marketplace for direction. State (16) _were sold to private (17) . The
(18) lost their control over prices. (19) _ _ and (20) _ were
no longer guaranteed by the state.
The pendulum swung in the same direction in Western Europe, Latin America, and Asia. In the mid-
1980s, Italy, France, and Great Britain (21) _ formerly government-run enterprises in
railroads, steel, telephones, and electricity. Mexico moved in a similar direction, as did India, Vietnam,
and a host of other countries. In every case, the motivation for change was the belief that (22)
directed economies would outperform government-directed ones.
The Republican sweep of the 1994 U.S. congressional elections also represented a movement away
from government regulation. Public-opinion polls showed that Americans were dissatisfied with the
pace of economic advancement and increasingly sceptical of the government's ability to fix things.
When the Republican party offered to reduce the role of government and rely more on the
marketplace to (23) jobs, raise (24) _ and promote prosperity, (25)
responded positively.
Source: B. R. Schiller: Essentials of Economics, 2nd edition, McGraw-Hill, 1996

II The historical overview ends with the mid 1990s. How would you end the text
today? Think of the direction of the pendulum.
 47
6 THE PRIVATE SECTOR: TYPES OF BUSINESS ORGANIZATIONS

The private sector is characterized by private ownership in the hands of private individuals.
It includes businesses that are run for the benefit of the people who own them.

I Read the text and underline the keywords.

UNINCORPORATED AND INCORPORATED BUSINESSES

In the unincorporated setup, the owners of the business are legally not separated from the
business: they are the business themselves. While they get a share of business profits, they also
expose themselves to a large degree of responsibility for all the liabilities and debts of their
business. This is because the owners of such businesses have unlimited liability for the debts of
the firm. Creditors can take over personal assets in case of business debt and can take over
business assets in case of personal debt as well. There is simply no room to be financially
careless.
There are fewer legal requirements to attend to when one wants to set up an unincorporated
business: the start-up fees are lower and the recurring costs (costs which a business owner has
to pay again and again) are lower.
An incorporated business grants the business a legal identity distinct from its owners.
Ownership of incorporated companies is through stocks (certificates of ownership). Issuing and
selling stocks is a way for such businesses to raise capital for the company. These stocks are the
owners' investment into the business, and through it they can get a share of the profit proportional
to the amount of stocks they have. Because of the separation of owners and business in the eyes
of the law, owners have limited liability in these companies: the debts, legal issues and other
responsibilities of the company do not carry over to the person of the owners. Creditors therefore
cannot claim personal property in cases of bankruptcy in an incorporated business. Likewise,
creditors cannot chase business assets in case the owners themselves go bankrupt. Separation
of owners and business also allows the easy transfer of business ownership through the selling of
stocks. Incorporation therefore allows the business to continue existing even if the owners retire
or die, and allows more opportunities for government financing and taking out larger bank
loans. Only incorporated businesses can be called companies. Larger companies often choose to
go public and start selling their stocks at the stock exchange where anybody can buy their stocks.
These companies are called public or listed companies.
Incorporation poses some drawbacks as well. Some of these include soaring start-up fees
because of the legal costs that incorporation entails, more legal requirements to contend with,
more record-keeping responsibilities in place and the obligation to regularly disclose their
accounts to their shareholders (or the general public in case of companies traded on the stock
exchange). Additionally, in large companies the management of companies is often separated
from the owners, which can result in owners disagreeing with decisions the management of the
company makes.
Adapted from : Ajaero, T. M. "Six advantages and disadvantages of incorporating a business"
http://www.evancarmichael.com/library/ajaero-tony-martins/Six-Advantages-and-Disadvantages-of-Incorporating-a-Business.html

II What are the advantages and disadvantages of the two types of business setup?
Unincorporated Incorporated
Advantages

Disadvantages
 III Talk about incorporated and unincorporated businesses with your group. Make full 48
sentences as follows:
The advantage(s) of … over … is/are that …
The disadvantage(s) of … over … is/are that …

IV Work in groups to answer these questions.

1) Your aunt wants to open a flower shop. She would like to

know if she should incorporate her business. Give reasons.

2) Your cousin has developed an innovative new product called

TeleDrone, which is a full-featured aerial drone operated through
ordinary smart phones. Should she incorporate her business? Give
reasons.
Vocabulary focus

I Match the definitions with the terms in the box.

Annual General Meeting (AGM), dividend, disclosure of accounts, takeover,
overdraft, incentive, unlimited liability, limited liability, share/stock,
Board of Directors

Amount of money which a company or a person can withdraw from a bank account
with the bank’s permission, and which is more than there is in the account.
A thing that encourages someone to work better.
A percentage of profits (after taxes) paid to shareholders. Large companies usually
pay it twice a year.
Limited companies are legally obliged to publish their accounts at the end of the
financial year.
A person's financial responsibility is limited to a fixed sum, usually the value of a
person's investment in a company. A shareholder in such a company is not
personally responsible for any of the debts of the company, other than for the value
of his investment in that company.
The owner(s) are personally responsible with their own wealth/assets for any legal
actions and debts the company may face.
Buying a controlling interest in a business by buying more than 50% of its shares.
One of many equal parts into which the company’s capital is divided.
A group of directors elected by the shareholders to run a company.
A meeting of all the shareholders, when the company’s financial situation is
discussed with the directors.

II Fill in the gaps with the missing words.

The owners of unincorporated businesses have ___________ liability for the debts that these
businesses make. This is because these firms are not __________ entities. The firm doesn't have
a separate legal __________ from its owner(s). If the owner dies, the business ends. Owners of
unincorporated businesses can _________ capital for their business from their friends, family or
they can take a __________ from a bank. If there are more owners, they will all have a claim on
the profits.
Incorporated businesses have a right to ____________ stocks to raise funds. Their owners are
called _______________, they have _____________ liability for the company's debts. If the
company decides to, it can pay out a __________ to the shareholders. The business has a
__________ identity, and it doesn't have to end if the owners die. The shares of some
incorporated businesses can be sold at the __________ exchange. These are called
___________ or listed companies. They have to ____________ their accounts to the public, so
that present and future shareholders can see how the company is doing financially.
 49

TYPES OF BUSINESS ORGANIZATIONS

I Look at the table on this page and skim through the reading on the next. Then fill in the table.

the UK Croatia
unincorporated
____________liability
incorporated
____________liability

Business organizations in the UK.

TYPE OWNER CONTROL SOURCES CLAIM ON ADVANTAGES DISADVANTAGES
-SHIP AND OF PROFITS
DECISION- FINANCE
MAKING

SOLE One One person Past savings; Sole owner Direct control of Unlimited liability for
PROPRIE- person bank loans (sole trader) business; quick debts; no opportunity
TORSHIP and decisions; few to specialise; skills
overdrafts. legal limited to those of
requirements to owner; business
set up; claim on ends on death.
profits provides
incentive.
PARTNER- Partners By partners Capital of Partners More finance Unlimited* liability for
SHIP partners; than the sole debts; relatively
bank loans owner; each limited finance;
partner can partnership ends on
specialize; death of any partner.
service of
specialists
available in
return for share
of profits; easy
communication.
PRIVATE Share- Board of Sale of Shareholders Limited liability More formalities to
LIMITED holders directors shares (but by dividend for debts; observe when setting
COMPANY elected by not to the payments continuity of life up; difficulty for
(Ltd.) shareholders general of business; people wanting to
public) access to large sell shares; possible
amounts of conflict between
capital; suitability owners and
for larger scale management.
organisation.

PUBLIC Share- Board of Sale of Shareholders Limited liability Formalities and

LIMITED holders directors shares up to by dividend for debts; regulations of
COMPANY elected by the limit of payments continuity of life establishment;
(Plc.) shareholders authorised of business; disclosure of
capital access to large accounts; increased
amounts of separation of
capital; suitability ownership and
for large scale management;
organisation. possible takeovers.

*In a LIMITED PARTNERSHIP some partners can have limited liability. They provide capital and take no part in the management of
the business.
 50
Business Organizations in Croatia

There are different types of companies in the Croatian legal system. Most businesses are run as
crafts (e.g. shoemakers), independent professions (e.g. lawyers), limited liability companies
and joint stock companies / companies limited by shares.
The owners of crafts and independent professions generally have unlimited liability for debts, and
these businesses are not legal entities on their own. The most common types of companies
in which owners have limited liability for debts in Croatia are limited liability companies
(društvo s ograničenom odgovornosti, d.o.o.) and joint stock companies / companies limited
by shares (dionička društva, d.d.). In limited liability companies (d.o.o.) one or more persons
or legal entities invest in the capital, and they are called shareholders. If they want, they can
sell their shares, but not to the general public. The company must have a management board
(uprava) and an assembly (skupština). They optionally have a supervisory board (nadzorni
odbor) that controls the work of the management board. The company is obliged to submit its
financial reports regularly to the Croatian Financial Agency (Fina).
Joint stock companies / companies limited by shares (d.d.) are companies which have even
more complex structure, higher minimum amount of share capital and often more
shareholders than limited liability companies. Joint-stock companies in Croatia have three
obligatory bodies responsible for running the company: the general assembly (glavna
skupština), a management board (uprava) and a supervisory board (nadzorni odbor).
Alternatively, instead of having two boards, companies can have their functions merged into
a single board of directors (upravni odbor). Just like limited liability companies, they have
to submit their financial reports regularly to Fina. They also have to disclose their accounts
publicly, i.e. make all important financial information available to the shareholders, potential
future investors and the public in general. Companies limited by shares can decide to go
public – start trading shares publicly on the stock exchange.
Based on: English for Business, Kiss Kulenović. Planinšek Čikara, Linčir Lumezi, Lekaj Lubina

II Answer these questions:

1 What are the simplest forms of business in Croatia?

2 What bodies have to be established by law in limited liability companies?
3 What is the difference between limited liability companies (d.o.o.) and joint stock companies
(d.d.)?

Vocabulary focus
I Find English words for these terms in the text.

1 obrt 8 skupština
2 profesionalna
samostalna djelatnost 9 nadzorni odbor

3 pravna osoba 10 glavna skupština

4 dioničko društvo, d.d. 11 dioničari

5 društvo s ograničenom
odgovornosti, d.o.o. 12 udjeličari
13 minimalni temeljni
6 uprava kapital

7 upravni odbor 14 burza

II Make word partnerships from the two columns below and copy them in the 51

third column.

1 Stock property
2 independent Exchange
3 personal board
4 management entity
5 legal capital
6 limited board
7 share assembly
8 general liability
9 supervisory professions

III Use the word partners from the above exercise in the following sentences.

1 When a company goes public it starts selling its shares at the_________________.

2 Owners of craft businesses have unlimited liability and they can lose their
_________________ in the case of bankruptcy.
3 Members of the _________________ take all the important decisions in a company.
4 Joint stock companies have _________________ for debts.
5 Dentists can work as _________________.
6 Limited liability companies are _________________ and they can be sued, taken over or
liquidated.
7 The bodies joint stock companies are obliged to have by law are _________________,
_________________ and _________________.
8 Minimum _________________ for both limited liability and joint stock companies is defined
by law.
SUMMARY
I Describe each type of business organization (UK or Croatian). Use the
prompts below.
e.g. Sole proprietorship is a type of business which is owned by one person.
 ...is a type of business which is owned by ...
 It is controlled by ... and managed by...
 This business is financed by ...
 Business decisions are made by ...
 ... has/have a claim on profits.
 ... is (are) /is not (are not) personally liable for ... because the owner(s) has (have)
limited/unlimited liability.

II Note the difference in the meaning of the word public in public-limited

company compared to its meaning in the public sector? Answer the following:

1. In which of the two expressions does public primarily mean “owned by the state”?
________________________________________________________________________
2. In which of the two expressions does public mean “of, or related to all the people”
(“available to everyone”)? Explain your answer.
________________________________________________________________________
 PRACTICE 52

I Make word partnerships from the two columns below and copy them in the
third column to get collocations typically used when talking about businesses.

1 set up a profit

2 be liable the profits

3 raise a loss

4 go shares

5 make a business

6 make capital

7 claim the company’s accounts

8 issue bankrupt

9 disclose for the company’s debts

II Fill in the gaps with the words from the boxes.

set up sued incorporated activity legal ownership

The private sector includes all those businesses which are (1) by
individuals or groups of individuals. Most business (2) is
undertaken in the private sector. Businesses will vary according to the legal form they take
and their (3) . They are broadly divided into unincorporated businesses,
with no legal difference between the owners and the business, and
(4) businesses, with a separate (5) identity
from its owners. In other words, an incorporated business can be (6) ,
taken over and liquidated (i.e. sold).

creditors assets liability bankrupt limited liquidated

Individuals and groups of people doing business as a partnership, have unlimited
(7)________ for debts. If the business cannot pay its debts, any creditor can have it
declared (8) . In order not to lose their personal (9) , most
people doing business form (10) companies, i.e. legal entities separate
from their owners and only liable for the amount of capital that has been invested in it. If a
limited company goes bankrupt, it is wound up and its assets are (11) to
pay the debts. If the assets do not cover the debts, they remain unpaid and
(12) simply do not get all their money back.

owners shareholders borrow stock exchange

Most companies begin as private-limited companies. Their (13) __________________ have to
provide capital themselves, or (14) __________________ from friends or a bank. A growing
company can apply to a (15) __________________ to become a public-limited company
(GB)/listed company (US), in other words, members of the general public can buy its shares and
become (16) ______________ in the company.
 shares issue founders general meetings managing director 53

(17) of limited companies need to prepare two documents describing

their firms. The Memorandum of Association sets out the name of the company, the total
share capital and the kind of shares it will (18) . It also guarantees the
limited liability of its holders. The Articles of Association are a set of rules stating how the
company will run itself internally – the Memorandum deals with the company and its dealings
with the outside world. The Articles cover the powers and duties of the directors, the issue
and transfer of (19) , the calling of (20) and the
salary and appointment of a (21) . Directors of limited companies
are appointed by shareholders. If shareholders are not satisfied with the company's
performance, directors can be removed at an Annual General Meeting (AGM).

Adapted from: MacKenzie (2002)English for Business Studies, p.91

III Fill in the gaps with the words from the box.

bankruptcy corporations creditors liability losses

partnership registered shares sole trader prospectus

The simplest form of business is the individual proprietorship or 1) ________________: for

example, a shop (US= store) or a taxi owned by a single person. If several individuals wish to go
into business together they can form a 2) ________________; partners generally contribute
equal capital, have equal authority in management, and share profits or
3)________________. In many countries, lawyers, doctors and accountants are not allowed to
form companies, but only partnerships with unlimited 4) ________________ for debts – which
should make them act responsibly.

But a partnership is not a legal entity separate from its owners; like sole traders, partners have
unlimited liability: in the case of 5) ________________, a partner with a personal fortune can lose
it all. Consequently, the majority of businesses are limited companies 6) (US= ____________),
in which investors are only liable for the amount of capital they have invested. If a limited
company goes bankrupt, its assets are sold (liquidated) to pay the debts; if the assets do not
cover the debts, they remain unpaid (i.e. 7) ________________do not get their money back).

In Britain, most smaller enterprises are private limited companies which cannot offer
8)________________ to the public; their owners can only raise capital from friends or from banks
and other venture capital institutions. A successful, growing British business can apply to the
Stock Exchange to become a public limited company; if accepted, it can publish
9)________________ and offer its shares for sale on the open stock market. In America, there is
no legal distinction between private and public limited corporations, but the equivalent of a public
limited company is one 10) ________________ by the Securities and Exchange Commission.

Source: Mackenzie, I. (1995). Financial English. LTP 1995.

 54
Legal types of business organisations – a contrastive view

UK US CRO

SOLE TRADER SOLE TRADER TRGOVAC POJEDINAC, OBRTNIK

PARTNERSHIP DRUŠTVO OSOBA

(trgovačko društvo)
cf. ortaštvo
«Messrs.AB&C», «Messrs.AB Bros.», «Messrs. AB&Co.»

general partner vs. limited partner komplementar vs. komanditor

deed of partnership, partnership agreement, articles of partnership društveni ugovor

general partnership cf. javno trgovačko društvo ( j.t.d.)

limited partnership cf. komanditno društvo (k.d.)

active partner, managing partner članovi koji vode poslove

dormant, silent, sleeping partner tajni član

COMPANY CORPORATION DRUŠTVO KAPITALA

(trgovačko društvo)

PRIVATE LIMITED COMPANY CLOSE CORPORATION cf. društvo s ograničenom

«ABC Ltd.» privately-held corporation odgovornošću (d.o.o.)

*LLC - limited liability company

(hybrid between a partnership
and a corporation)

PUBLIC LIMITED COMPANY OPEN CORPORATION cf. dioničko društvo (d.d.)

publicly-held corporation

«ABC plc.» «ABC Inc.», «ABC Co.», «ABC

Corp.»

Companies Act Model Business Corporation Act Zakon o trgovačkim društvima

shares stocks, shares cf. dionice (d.d.) i poslovni

shareholders stockholders, shareholders udjeli(d.o.o.)
ulog (d.d.) i temeljni ulog (d.o.o.)
temeljni kapital (d.d. i d.o.o.)
cf. dioničari (d.d.), članovi (d.o.o.)

annual general meeting (AGM) annual meeting of stockholders glavna skupština

Articles of Association bylaws statut (d.d.)

Memorandum of Association charter društveni ugovor/izjava o osnivanju
(d.o.o.)

Chairperson Chairperson/President predsjednik uprave/upravnog odbora

Board of Directors Board of Directors upravni odbor
Supervisory Board Supervisory Board nadzorni odbor
Management Board Management Board uprava
Managing Director (MD) Chief Executive Officer (CEO) generalni, glavni izvršni direktor
 55
BUSINESS ORGANISATIONS IN THE PRIVATE AND IN THE PUBLIC SECTOR
(UK)

I Fill in the missing words.

Adapted from D. Hall, R.Jones, C. Raffo: Business Studies, 2nd ed., 2000, Causeway Press Limited
 56
REVISION 2
The Public Sector, The Role of the Government, Taxation, Privatization,
The Private Sector: Types of Businesses

I Read through this list of terms and decide which terms belongs to which unit. Some
might fit in more than one place.
regressive tax, sole proprietorship, dividend, legal identity, craft, unincorporated business, legal
entity, a loophole in the law, limited liability, partnership, central government, mass privatization,
tax revenue, welfare state, limited liability company, start-up fees, local government, trading
surplus, levy a tax, unlimited liability, expand local capital markets, incorporated business,
government intervention, independent professions, increase efficiency, personal assets, flat tax,
tax compliance, public goods, taxation, merit goods, shareholder, non-rival, evade a tax, non-
excludable, state-owned enterprises, collect a tax, local authority services, stock exchange, file
a tax return, tax exemption, positive externalities, Ltd, layoff, direct tax, listed company, avoid a
tax, progressive tax, indirect tax, tax morale, austerity plan, issue shares, diversify, business
assets, disclosure of accounts, Plc, assembly,
The Public Sector

The Role of the

Government

Taxation

Privatization

The Private Sector: Types

of Businesses

II Look at the words in task I again and …

a) explain their meaning in your own words.
b) use each in a sentence.
 57
III Explain the difference between the following concepts:

1 public sector / private sector

2 public corporations / local authority services
3 public goods / merit goods
4 Gailbraith's idea on the responsibilities of the state / Friedman's idea on the same
5 direct taxes / indirect taxes
6 progressive taxes / regressive taxes / proportional taxes
7 tax evasion / tax avoidance
8 low tax morale / high tax morale
9 privatization / nationalization
10 unincorporated businesses / incorporated businesses
11 unlimited liability / limited liability
12 public limited company / private limited company
13 public corporation / public limited company
14 limited liability companies / joint stock companies
 58
7 ENTREPRENEURSHIP
I Can you think of words which are related to the word entrepreneur?

entrepren__ __ __ __ __ __ __ (n) entrepren__ __ __ __ __ __ (adj)

enterpr__ __ __ (n)

II Now match the definitions with the words.

1 The capacity and willingness to develop, organize and manage a business venture along with
any of its risks in order to make a profit. _________________
2 A person who sets up, owns and directs a company and takes commercial risks.
_________________
3 A business where the primary motive is profit and not only employment for oneself and
others. It is implied that the person who set up such a business showed some initiative and
took a risk by setting up, investing in and running a business. _________________
4 An adjective used to describe someone who makes money by starting their own business,
especially when this involves seeing a new opportunity and taking risks. _________________

III Answer the following questions, read the text and check your answers.

1 What do you need to start up a business?

2 How can start-ups be funded?
3 What advantages and risks are associated with privately run businesses?

GOING INTO BUSINESS

New business ventures originate when entrepreneurs set up companies either to sell
innovative products or services or to compete against established businesses. Before
starting a new business, entrepreneurs often conduct market research to determine the
validity of their idea and the feasibility of their business model. All start-ups face a high
degree of risk and it is estimated that only twenty per cent of new businesses are actually
successful in the long term. Future entrepreneurs always have to draw up a business plan in
which they describe their concept and their business approach. They may receive
assistance from outside organisations such as incubators and venture capital firms or from
individual business angels, usually in exchange for a stake in the company. Start-ups can
be funded either directly by the founders or by using capital provided by investors or
banks. In some countries governments may provide low-interest loans or grants to
entrepreneurs. “Crowdfunding” has recently become a very popular financing technique
where a large group of people invest money in a business idea, usually via the Internet.
Adapted from: Trappe, T., Tullis G. (2011). Intelligent Business, Advanced. Pearson Longman

IV Find the words in the text that mean the following:

1 A document drawn up to show how a business is planned to work.

2 A financial award given by the state or local government, which is not

expected to be repaid.
3 A business project or activity, especially one that involves
risks.
4 An investment company that invests capital in potentially risky but
profitable start-ups for above-average returns.
5 A rich investor who provides capital for a start-up in exchange for
ownership equity or a stake in the company. This private individual usually
becomes involved in the project by acting as a guide or mentor, as well as
by providing connections to their larger network
6 Ability to complete a project successfully, taking into account the possible
negative and positive outcomes before investing too much time and money.
 7 An organization designed to accelerate the growth and success of 59
entrepreneurial companies through an array of business support resources
and services that could include physical space, capital, coaching, common
services and networking connections.
8 The state of being well-founded.

9 The amount that someone has invested in a company often expressed as

a percentage of the total share capital (=money invested in a business in
the form of shares)

V Read the text again and fill in the gaps to make word partnerships.
1 C__MP__T__ against an established business.
2 R__C__ __V__ assistance from incubators and business angels
3 C__ND__CT market research
4 F__C__ a risk
5 DR__W __P a business plan
6 PR__V__D__ a low-interest loan
7 D__T__RM__N__ the feasibility of the business model

VI Replace the underlined phrases with business English terms.

Mark came up with a completely new idea on how to provide customers with fresh organic

vegetables. He started a new firm to do this. Luckily he didn’t have any existing rivals. He was

told to ask his future customers if they liked his plan to check if his solution to the problem was

well-founded and possible to carry out. His new business needed money, so he wrote down

what he wanted to do and went to a bank to ask for some money and to rich people with money

who he asked to invest in his firm. He also applied for money from the government.

VII Fill in the gaps with the words in the box. Some sentences can have more
solutions.

turn something into put somebody out of run have go out of

fund set up do close down start go into

1 The government introduced new regulations which unfortunately made a lot of start-ups
business.
2 New entrepreneurs a business either to sell their innovative products or to
compete against established businesses.
3 Our retail company business with an Indian manufacturer.
4 After graduating from business school, she business with private jet
operators.
5 Start-ups can be directly by the founders or by using capital provided by
private investors or banks.
6 When you decide to end your business operations, it can take time to
your business properly. You need a careful plan that will protect your
personal assets and your reputation.
7 A business incubator provides a new entrepreneur with complete business support to
overcome initial difficulties and a business successfully in the future.
 VIII Sort out the verbs from exercise VII and decide which can form partnerships with 60
“a business” and which with “business”
___________________
___________________
___________________
___________________
___________________
___________________ a business business
___________________
___________________
___________________
___________________
___________________

IX Fill in the words which are missing in the questions. Then read carefully and
find out if you possess personality traits to be an entrepreneur.

organised hard realis risk challenge

network
working plan t committed

Are you a taker?

1 No business is risk free, so you need to judge the level of risk and be prepared to live with
consequences.
Is change a ?

2 Can you minimise its downsides with careful thought and planning?

Are you ?

3 Being self-employed is not an easy option, especially if you are working on your own.
Results are often only produced by working long hours.

Are you ?

4 You will need to be an excellent time manager. You will need to juggle
tasks, meet deadlines and prioritise conflicting demands.

Can you ?

5 It is essential to be able to market yourself and your business in social situations. A lot of
business is made by networking.

Are you ?

6 Do you believe in yourself and your business idea? Doubts or a half-hearted approach can
be disastrous.

Do you ahead?
7 You need to do this to minimise uncertainties and maximise your chances of success.
Good planning ensures work keeps coming in.

Are you a ?

8 Can you gauge in practical terms what is possible to achieve or produce within a certain
period?
If you answered YES to all the questions then you have the right personality traits to be an
entrepreneur.
Adapted from: http://www.xlntelecom.co.uk/business-resources/starting-your-own-business/
 61
X Writing a business plan
1 Form a group that you will be working with in the long-
term.
2 Come up with an idea for a business that you could set up.
3 Go to p. 122 and fill in the first section of the Business plan
for your business.
4 From now on, please fill in the appropriate part of the
business plan after every unit.

WHO ARE ENTREPRENEURS?

I Can you explain the sentence?

“True entrepreneurs find worth in the worthless and possibility in the
impossible.”

II Mark the sentences TRUE or FALSE, then read the article and check your
TRUE or FALSE answers again.

1 Entrepreneurship today is a synonym for economic progress.

2 The term entrepreneurship mostly covers start-ups.
3 A common misconception is that entrepreneurship means new technology.
4 Only geeks and innovators are able to create high-growth companies.
5 Small businesses are not as vital for an economy as high growth businesses.
6 A businessman is an entrepreneur.
7 An entrepreneur sees the opportunity where a conventional businessman can see
nothing worth trying.
8 Some of the most successful entrepreneurs are distinguished more by the ability to
achieve the impossible than by the originality of their ideas.
9 Policymakers who would really like to encourage entrepreneurship should only give
an opportunity to particular type of businesses.
10 “Doing well by doing good” is the main motivator for entrepreneurs to take huge risks
and endure years of hardship.
11 Entrepreneurs enjoy taking risks which create big losers but also fabulously rich
individuals.
12 Economic progress takes place in “cracks” and “leaps” rather than “tiny steps”
because it is driven by rule-breaking entrepreneurs.

III Read the article again and answer the questions:

1 What is the difference between a small business owner and an entrepreneur?

2 What should governments do to encourage entrepreneurship?
3 In what ways are governments wrong about what entrepreneurship is?

Note on Joseph Schumpeter:

1
One of the 20th century’s great economic and political thinkers. He is well known for his theory
explaining the activities that lead to economic growth in capitalist economies. His theory centres around
entrepreneurial innovations and their role as the key driver of economic growth. He argues that
competition among market participants leads to a desire to seek out new ways to improve technology,
new ways to do business and other types of advantages that would increase profit margins and directly
impact the entrepreneur’s standard of living. Schumpeter describes the act of new innovations
replacing old innovations as “creative destruction”.
Source: Investopedia
 62
Crazy Diamonds
IV Read the text and provide subheadings for each paragraph.

True entrepreneurs find worth in the worthless a new definition of entrepreneurship. In essence,
and possibility in the impossible entrepreneurs are contrarian value creators. They see
economic value where others see heaps of nothing.
And they see business opportunities where others
1 ENTREPRENEURSHIP is the modern-day
philosopher’s stone: a mysterious something that see only dead ends.
supposedly holds the secret to boosting growth and
7 There are plenty of striking examples of this: the
creating jobs. The G20 countries hold an annual
founder of Celtel, saw the possibility of bringing
youth-entrepreneurship summit. More than 130
mobile phones to sub-Saharan Africa when telecoms
countries celebrate Global Entrepreneurship Week.
giants saw only penniless peasants and logistical
Business schools offer hugely popular courses on
nightmares. On a trip to Tobago Sean Dimin and his
how to become an entrepreneur. Business gurus
father Michael observed that fishermen were leaving
produce (often contradictory) guides to
tonnes of fish to rot, so they created a company, Sea
entrepreneurship: David Gumpert wrote both “How to
to Table , to get the surplus fish to New York
Really Create a Successful Business Plan” and “Burn
restaurants.
Your Business Plan!”.
8 Mr Isenberg emphasises that successful contrarians
2 But what exactly is entrepreneurship (apart from a
also need the self-confidence to defy conventional
longer way of saying “enterprise”)? And how should
wisdom and the determination to overcome obstacles
governments encourage it? The policymakers are as
(it took the Dimins two years to get the fishermen to
confused as the gurus. They assume that it must
change their habits). Indeed, some of the best
mean new technology; so they try to create new
entrepreneurs are distinguished more by their ability
Silicon Valleys. Or that it is about small businesses;
to achieve the impossible than by the originality of
so they focus on fostering start-ups. Both
their thinking. TCS is essentially a Pakistani version of
assumptions are misleading.
FedEx. But to get it going, Khalid Awan had to
3 Silicon Valley has certainly been the capital of overcome “insuperable” problems such as striking
technology-based entrepreneurship in recent deals with the gangs that control the haulage industry
decades. But you do not need to be a geek to be an and sweet-talking the politicians who can shut a new
entrepreneur. George Mitchell, the Texas oilman who company at the drop of a hat.
pioneered fracking, did as much to change the world
as anybody in the Valley. Nor do you need to be a
9 Mr Isenberg has two important bits of advice for
conventional innovator. Miguel Davila and his
policymakers who genuinely want to foster
colleagues built a huge business by importing the
entrepreneurship. First, they should remove barriers
American multiplex cinema into Mexico. Their only
to entry, and growth, for all sorts of business, rather
innovation, says Mr Davila, “was putting lime juice
than seeking to build particular types of clusters.
and chilli sauce on the popcorn instead of butter.”
Second, they should recognise the importance of the
4 Equally, there is a world of difference between the profit motive. There has been much fancy talk of
typical small-business owner (who dreams of opening social entrepreneurship”, harnessing enterprise to do
another shop) and the true entrepreneur (who dreams good deeds, but in truth the main motivator for
of changing an entire industry). Jim McCann, the entrepreneurs is the chance of making big money.
creator of 1-800-flowers.com, is an entrepreneur This is what drives people to take huge risks and
rather than just a florist because, when he opened his endure years of hardship. And this is what
first shop in 1976, he looked at the business “with encourages investors to take a punt on business
McDonald’s eyes”, as he put it, and laboured for ideas that, at first sight, look half-crazy
years to build the world’s biggest flower-delivery
10 Politicians and bureaucrats do not just confuse
business.
entrepreneurship with things they like-technology,
5 These misconceptions matter because they small business-they also fail to recognise that it
produce lousy policies. The world is littered with high- entails things that set their teeth on edge.
tech enclaves that fail to flourish. Malaysia’s biotech Entrepreneurs thrive on inequality: the fabulous
valley has been nicknamed “Valley of the BioGhosts”. wealth they generate in America makes the country
The world is also full of small-business departments more unequal. They also thrive on disruption, which
that fail to produce many jobs. Kauffman Foundation, creates losers as well as winners. Joseph
which researches such matters, has shown that the Schumpeter once argued that economic progress
bulk of new jobs come from a tiny sliver of high- takes place in “cracks” and “leaps” rather than
growth companies. “infinitesimal small steps” because it is driven by rule-
breaking entrepreneurs. It might be nice to think that
6 Daniel Isenberg has spent 30 years immersed in we could have growth and job-creation without a good
the world of entrepreneurship as a (sometimes failed) deal of Schumpeterian cracking. But, alas, some
entrepreneur and venture capitalist as well as an thoughts really are worthless, impossible and stupid.
academic (he previously taught at Harvard Business th
School and is now at nearby Babson College). He
Source: The Economist, July 20 2013
has also travelled the world accumulating examples -
he is just as interested in Island’s generic-drug
industry as in Silicon Valley’s giants. In a new book
“Worthless, Impossible and Stupid”, he presents
 63

V Find the expressions in the text which match the following definitions.

Paragraph 2
A small business that has just been started.
Influential individuals who have the authority to set the
plan pursued by a government or business.
Paragraph 6
An opportunity to generate income as a business owner
and not an employment opportunity.
Paragraph 9
The existence of high start-up costs or other obstacles
that prevent new competitors from easily entering an
industry, market or an area of business.

VI Find the following entrepreneurs in the text again. What kind of business did they
open and what was innovative about it?

Name of entrepreneur Business area Innovation

George Mitchell

Miguel Davila

Jim McCann

the founder of Celtel

Sean and Michael Dimin

Khalid Awan

VII Answer these questions.

1 What characteristics do the entrepreneurs listed above share?

2 The text says that governments base their policies on some misconceptions (wrong ideas).
What are these misconceptions?
3 How can a government make sure that new enterprises are started in the country?
 64

VIII Summarize the main ideas about entrepreneurs Use the prompts.
Entrepreneurs are _______________________since they _______________________ where the
others _______________________.
They see _______________________ where others _____________________________
_______________________________________________________________.
The successful _______________________ need to have _______________________ to defy and
the determination to _______________________.
The main motivator for entrepreneurs is ____________________________________________
which drives them to _______________________ and _______________________. Entrepreneurial
innovations in the world of technology and in the new ways of doing business are the key factors
_______________________.
PRACTICE
I Use the words in italics at the end of each of the following sentences to form a
word that fits in the blank space.
1 His__________________ drive and energy are important for the (entrepreneurship)
success of our project.

2 __________________ studies are almost always conducted (feasible)

3 She worked as a product manager at an internet (to start)
_________________.
4 We have to__________________ with cheap imports from the Far (competitive)
East.
5 When you decide to__________________ a business, intelligent (founder)
goal setting is an essential step.
6 He received an award for the most __________________ design in (invent)
consumer electronics.

II Read and fill in the gaps in the sentences with the words from the box.
start-up entrepreneurs invented fails founders invention
launched entrepreneurial start up innovative competitive
Student entrepreneurs
Ana Burica (23) and Josipa Majić (23), the (1) of a medical (2)__________
IDerma, are not only business students from the Faculty of Economics and Business in Zagreb,
but also (3)_____________ entrepreneurs. In 2012 they (4) _____________ special software that
solves the problems in communication between doctors and patients. A white-label medical
application enables dermatologists to collect information about their patients, profile disease and
monitor their therapy in a personalised way. At the same time, the patients can observe their
health condition and get directly involved in the treatment. The team can create a personalized
white label medical application in only 48 hours for a (5) __________ price of $99.They already
have a respectable number of clients, mostly clinics and medical institutions, from around the world.
The (6) young women, who were selected by the European Commission to
represent Croatia in the EU, would like to encourage students to build their own projects and
(7)________________ a business. The founders, who initially financed IDerma project by
themselves, claim a start-up is worth the risk because even if a new business (8) ____________
young (9) ________________ will gain some valuable experience and benefit from new
business contacts. The ambitious graduates have just (10)________________ another hi-tech
medical (11) _________________,Teddy, the Guardian, a teddy bear with integrated sensors
which can measure a child’s body temperature, blood pressure and heart rate, sending the
information immediately to the parents’ mobile application.
Adapted from: Kiss Kulenović, B., Lekaj Lubina, B., Lumezi Linčir, M., Planinšek-Čikara, I. (2014). English for Business
 65
8 MANAGEMENT: COMPANY STRUCTURE
I Look at these terms describing someone’s position at work. Are they higher or lower in
the chain of command?
subordinate, boss, senior, junior, director, superior, manager, assistant,
worker

HIGHER LOWER

II Phrases to describe chain of command. Match up the synonymous terms.

to be responsible for, to be responsible to, to assist, to be assisted by, to report to

1 To be in charge of – ________________________________
2 To support – ________________________________
3 To be supported by – ________________________________
4 To be accountable to – ________________________________
– ________________________________

III Fill in the gaps with the phrases from above.

1 The Area Sales Manager ___________________ the Head of Sales.
2 The Marketing Manager is ___________________ the Managing Director.
3 Human Resources are ___________________ employing staff.
4 Our team of sales reps is ___________________ the Sales and Marketing Department.
5 Interns may also be called to ___________________ the head of the Budget Section in
monitoring the status of projects.

Which company structure to choose?

IV Work in groups. Make decisions and give reasons for your decisions.
1) Choose a company:
A) A car manufacturer
B) A marketing firm

2) Congratulations! You have just been hired by company A or B. Your job is

an entry-level position. Which company structure would you prefer?

Think about the following:

 What makes you feel motivated?
 Do you like being told what to do?
 Should work be challenging or comfortable?
 Do you like having a boss?
 Do you mind having more than one?

3) Congratulations! You have successfully climbed the corporate ladder and have just been named
the CEO of your company. You decided to reorganize the company. Which company structure will
you choose?
Think about the following:
 How closely do you want to supervise your subordinates?
 Do you expect lower level employees to contribute their ideas?
 How closely do the different departments of the company need to work together?

V Think back at the task you just did. Why is it important what the company does?
 66
THE CORPORATE STRUCTURE OF PUBLICLY TRADED COMPANIES
I Match the position with the responsibilities that go with it.
Chief Executive Officer (CEO), Chief Operations Officer (COO),
Chairman/ Chairwoman of the Board, Chief Finance Officer (CFO)
Responsible for the corporation's operations, looks after issues related to marketing, sales, production
and personnel.
Leader of the corporation, runs the Board and maintains communication with the CEO and high-level
executives.
Responsible for the entire operation of the corporation and reports directly to the chairman and board of
directors. (Other name: Managing Director).
Also reporting directly to the CEO, he is responsible for analyzing and reviewing financial data, reporting
financial performance, preparing budgets and monitoring expenditures and costs.

II Complete the diagram of the corporate structure of publicly traded companies.

S_________
_____________
Chairperson

_______

______ _______

Finance Accounting Marketing Sales Personnel

manager manager manager manager manager

PRACTICE
I Read the text and complete the organization chart:
I think we have a fairly typical organization for a manufacturing firm. We’re divided into Finance,
Production, Marketing and Human Resources departments.
The Human Resources department is the simplest. It consists of two sections. One is responsible for
recruitment and personnel matters; the other is in charge of training.
The Marketing department is made up of three sections: Sales, Sales Promotion and Advertising, whose
heads are all accountable to the marketing manager.
The Production department consists of five sections. The first of these is Production Control, which is in
charge of both Scheduling and Materials Control. Then there’s Purchasing, Manufacturing, Quality
Control, and Engineering Support. Manufacturing contains three sections: Tooling, Assembly, and
Fabrication.
Finance is composed of two sections: Financial Management, which is responsible for capital
requirements, fund control, and credit, and Accounting.

II Find the other four verbs in the text that mean the same as “to consist of”?
1 2 3 4

Source: MacKenzie,I. Management and Marketing, LTP, 1997

 67

9 EMPLOYEES AND LABOUR RELATIONS

LABOUR RELATIONS AND TRADE UNIONS

Labour relations or industrial relations are relations between the management of a company
and its workers. The two sides usually discuss three main issues: wages, working hours and
working conditions. Workers’ interests can be represented by trade unions (labour unions).

I Read and underline the keywords.

Unions negotiate collective-bargaining agreements which specify who can fill different jobs, how
much workers will be paid, and what the work rules are. And unions can decide to go on strike or
take other forms of industrial action in order to win a better deal from an employer. The study of
unions is an important part of understanding the dynamics of labor markets.
The wages and fringe benefits of unionized workers are determined by collective bargaining. …
The centerpiece is the economic package. This includes basic wage rates for different job
categories, along with the rules for holidays and coffee breaks. In addition, the agreement
contains fringe benefits such as a pension plan, coverage for healthcare, and similar items.
A second important issue is work rules. These concern work assignment and tasks, job security,
and workloads. Particularly in declining industries, the staffing requirements are a major issue,
because the demand for labor is falling. In the railroad industry, for example, there were decades
of disputes about the number of people needed to run a train.
Samuelson, P. A., Nordhaus, W. D. (2010) Economics. New York: McGraw-Hill International edition. p 257.

II Complete the word partnerships.

1 N__G__T__ __TE an agreement 7 FR__NG__ benefits

2 C__LL__CT__V__ bargaining 8 __N__ __N__Z__D workers
3 work R__L__S 9 __C__N__M__C package
4 go on STR__K__ 10 W__G__ rate
5 take an __ND__STR__ __L action 11 P__NS__ __N plan
6 labor M__RK__T 12 job S__C__R__TY

III Complete the mindmap based on the text. Make sure you use the keywords (and key
word partnerships) from the text.

NEGOTIATIONS AND/OR EMPLOYER

TRADE UNION INDUSTRIAL ACTION

C____________ - B____________ AGREEMENT

 68

IV Match the words on the left to the definitions on the right.

1. COLLECTIVE A a general term for strikes, go-slows, work-to-rules, etc.

BARGAINING
2. A STRIKE B a deliberate reduction in the rate of production, as a
protest
3. A GO-SLOW (GB) C a stoppage of work, as a protest against working
or SLOWDOWN (US) conditions, low pay, and so on
4. WORKING-TO-RULE D negotiations between unions and employees about their
members’ wages and working conditions
5. INDUSTRIAL E to protest outside a factory or other workplace, and try to
ACTION persuade workers and delivery not to enter
6. TO PICKET F deliberately obeying every regulation in an organization,
which severely disrupts normal operations
Source: MacKenzie, English for Business Studies (2002)

Resolving problems at work

I Which of these terms are defined below?
industrial action, arbitration, staff representatives, strike, works council, tribunal,
trade union, grievance, industrial relations, co-worker

A legal technique for the resolution of disputes outside the courts.

A council composed of both employer and employees convened to discuss
matters of common interest.
An organisation with powers to hear disputes and make decisions, similar to a
court.
A complaint.

II Use the terms in task I to complete the paragraph.

Management and trade unions are jointly responsible for (1) _________________. Management
and (2) _________________ often come together on a firm’s (3) _________________ to attempt
to resolve problems before they become too serious. If, however, the issue cannot be solved,
they may use outside (4) _________________ to assist them. If all attempts to find a solution
fail, the (5) _________________ may call a (6)_________________, or take other forms of
(7)_________________.
If an individual employee has a complaint, a company usually has a (8_________________
procedure to deal with it. Employees may also contact their trade union or an industrial
(9)________________ if they have a complaint about their treatment at work or about a
colleague or a (10) _________________ .
Source: Robbins, S. (2003). Business Vocabulary in Practise. Collins Cobuild.

III Complete the table based on the text. Then explain how different types of problems
can be solved at a workplace.
Common problem of all / most employees Individual employee’s complaint

W_____________ C____________ company’s G_____________ P___________

if they cannot agree  OR
_______________ ______________ I_________________ T______________
if still no solution  AND / OR
_______________ _____________
Trade Union
 69
10 RECRUITMENT

I Discuss these questions before doing the exercises:

1. What kind of job would you like to do?

2. What skills and qualities do you need for it?
3. What sort of duties would you have?
4. What sort of working week would you have?

II Read the definitions and fill in the missing words:

1. A record of a person’s education, employment, and interests.

2. Knowledge and skills that you gain by doing a job or activity.
3. Regular monthly payment for administrative work.
4. An official request for a job.
5. Certificates and diplomas are records of formal qualifications.
6. A meeting where you are questioned about your suitability for a job.
7. Statements of former employers or teachers about your character and abilities.

III Match the words and put the matched expressions in logical order:

attend the job 1

put on on the payroll 2
identify an interview 3
give a vacancy 4
advertise CVs and covering 5
letters
receive a shortlist 6
be notice 7

IV Complete the sentences with the right preposition:

People looking ______ work generally read the vacancies ______ newspapers. To reply
______ an ad is to apply ______ a job. You fill ______ the form, send it along ______ your
CV and a covering letter. You are asked to give the names ______ two people prepared to
write a reference ______ you.
 70
V Match each form of payment in the box with the right person (1-10):

royalty bonus stock option wage grant

redundancy pay fees salary commission pension

1. blue collar worker

2. student

3. white-collar worker

4. laid off employee

5. retired employee

6. lawyer

7. author

8. sales representative

9. senior manager

10. any employee for good work

(Adapted from: Steve Flinders: Test Your Professional English, Business: Intermediate, Pearson Education
Limited, 2002)

VI Fill in the gaps with the words from the box:

headhunting background contract applicants shortlisted

resumes interview recruitment experience description

The most important step to take when performing the process is a clear
understanding of the job for which businesses are hiring. Before meeting with the job
, hiring managers must decide upon the responsibilities of the position.
They must be clear about the educational and professional
they seek in the ideal candidate.
When the responsibilities, requirements and the salary range of a job are determined in
the job , hiring managers may post ads on online job search sites or in
traditional publications. They may also utilize the services of a agency
that maintains a pool of qualified, pre-screened candidates.
Then begin to pour in and hiring managers must screen each one.
Once the most appropriate resumes are identified, candidates are
and invited for an . When an ideal candidate has been
found, the applicant signs a .
(Adapted from: Ian Mackenzie: English for Business Studies, CUP, 2002)
 71
VIII Choose the words from the brackets to fill the gap:

1 (join/recruit)
We need to four new people for our office in Manchester.

2…(agency/head hunter)
We are using a recruitment _to find them for us.

3…(positions/applicants)
They advertised the in the local newspaper last week.

4 (application/situation)
We are going to look at all the letters of over the weekend.

5 (reference/short list)
On Monday, we will draw up a __________________ of ten or eleven people.

6 (interview/appointment)
Then we will invite them all to come for an .

7 (apply/appoint)
We hope to somebody by the end of the month.

8…(unemployable/unemployed)
Ivan has been ever since he graduated from the FEB.

9 (employee/employment)
The company has provided opportunities of for young people.

10 (employer/employee)
Lana won the of the month prize twice last year.

IX When an employee begins a job they will sign a written contract of employment
with the company, stating the conditions of work that have been agreed. Look at the
list of conditions and put them under the correct heading.
4 weeks’ paid holiday per year paid sick leave 48 hours per week

one month’s notice consequences of breaking company rules

who to contact to make a complaint £30,000 per year $9 per hour

trade union membership permanent/temporary job full-time /part-time

job
NUMBER OF HOURS

TYPE OF EMPLOYMENT

PAY

BENEFITS

DISCIPLINARY PROCEDURES

NOTICE

GRIEVANCE PROCEDURES

EMPLOYEE RIGHTS

Source: Robbins, S. (2003). Business Vocabulary in Practise. Collins Cobuild.

 72
REVISION 3

Entrepreneurship, Management, Company Structure, Work and Motivation, Labour

Relations, Recruitment

I Read through this list of terms and decide which terms belongs to which unit. Some
might fit in more than one place

entrepreneur, CV, set objectives, hierarchy, Theory X, picket, headhunter, subordinate, economic
package, threaten, employment agency, enterprise, promotion, responsibility, industrial action,
works council, motivators, business plan, collective-bargaining agreement, pyramidal structure,
department, work rules, delegate, market research, allocate resources, work-to-rule, COO, chain
of command, measuring people, job rotation, feasibility, department, venture capital firm, reward,
strike, start-up incubator, CFO, challenging job, business angel, tribunal, motivation,
crowdfunding, innovative, superior, CEO, arbitration, pay rise, hygiene factors, Chairperson (of
the board of directors), flat company structure, trade union, develop people, matrix company
structure, shortlisted candidates, bonus, Theory Y, fringe benefits, perform tasks, job application,
Maslow’s pyramid, functional structure, letter of reference, job security, job description, advertise
a vacancy, teams, government grant, line authority, communication, psychological need to work,
corporate culture

Entrepreneurship

Management

Company Structure

Work and Motivation

Labour Relations

Recruitment

II Look at the words in task I again and …

a) explain their meaning in your own words.
b) use each in a sentence.
III Explain the difference between the following concepts: 73

1 business angles / venture capital firms

2 a government loan / a government grant
3 to put somebody out of business / to go out of business
4 to assist somebody / to be assisted by somebody
5 COO / CFO
6 CEO / Chairman/woman of the board
7 job security / job safety
8 fringe benefits / workers’ rights
9 blue collar workers / white collar workers
10 pink collar workers / gold collar workers
11 employee / employer
12 application / applicant
13 headhunter / employment agency
14 recruit someone for a job / apply for a job
15 CV / letter of motivation
16 flat company structure / tall company structure
17 decision-making in a flat company structure / decision-making in a tall company structure
18 chain of command in a flat company structure / chain of command in a tall company
structure
19 matrix company structure / pyramidal company structure
20 Theory X / Theory Y
21 Hygiene factors / motivators
22 Maslow’s physiological needs (at the workplace) / Maslow’s esteem needs (at the
workplace)
 74
11 MARKETING

PRODUCTS

I Complete the notes on the text in MK, p. 60.

Products:
The definition of products:
__________________________________________________________________________
__________________________________________________________________________
Examples for products:
__________________________________________________________________________
Products belong in product __________ and product __________.
A product __________ is a group of closely related products sold to the same customer groups,
and marketed through the same outlets.
A product _________ is the total sum of products offered by a particular organization. It consists
of both product lines and individual products.

Brands:
Brands are ________________________________________________________________
__________________________________________________________________________
The key objective of branding is ________________________________________________ .
Good brands represent ________________________________________________.

If a company advertises enough it will achieve brand _____________, which means that people
will ________________ it even if they do not buy it. Brand loyalty is
_______________________________
______________________________________________________.
Branding is used both in ________________ and _________________ marketing.

Branding strategies:
There are two main branding strategies mentioned in the text:
1) _______________________________ and 2) _____________________________
1) ________________________________________________________________________
________________________________________________________________________
For example, _______________________________________________________

2) _____________________________________________________________________
________________________________________________________________________
For example, _______________________________________________________
Multi-brand strategy uses _______________________ (branding strategy). 75
It means _________________________________________________________________
________________________________________________________________________
Companies use this technique …
to fill up more ________________________________________.
to acquire greater ________________________________________.
to attract _______________________________________________.
to motivate _______________________________________________.

Brand value:
Brand value comes from ________________________________________________.
Accountants measure a company's worth in different ways. They calculate a company's book
____________ and its market ________________.
Book ____________ means: ___________________________________________________
_____________________________________________________________________

Market ____________ means: _________________________________________________

_______________________________________________________________________.

Brand value is calculated into a company's _____________ value.

The Coca-Cola example shows that _____________________________________________

_______________________________________________________________________.

THE LIFE CYCLE OF A PRODUCT

I Use this graph and the information in MK

(p. 65) to describe the life cycle of Swifty, a laptop
sold by your company. Talk about sales figures,
promotion, brand awareness, brand loyalty,
prices, competition, profits, etc.
 76
MARKETING

I Look quickly through the text and decide which paragraphs are about these
subjects:
- company-to-company marketing
- identifying market opportunities
- the marketing mix
- the selling and marketing concepts
- the importance of market research
THE CENTRALITY OF MARKETING
1 Most management and marketing writers now distinguish between selling and marketing.
The ‘selling concept’ assumes that resisting consumers have to be persuaded by vigorous hard-
selling techniques to buy non-essential goods or services. Products are sold rather than bought.
The ‘marketing concept’, on the contrary, assumes that the producer’s task is to find wants and fill
them. In other words, you don’t sell what you make, you make what will be bought. As well as
satisfying existing needs, marketers can also anticipate and create new ones. The markets for the
Walkman, video recorders video game consoles, CD players, personal computers, internet,
mobile phones, mountain bikes, snowboards, and genetic engineering, to choose some recent
examples were largely created rather than identified.

2 Marketers are consequently always looking for market opportunities – profitable possibilities
of filling unsatisfied needs or creating new ones in areas in which the company is likely to enjoy a
differential advantage due to its competencies (the things it does particularly well). Market
opportunities are generally isolated by market segmentation. Once a target market has been
identified, a company has to decide what goods or service to offer. This means that much of the
work of marketing has been done before the final product or service comes into existence. It also
means that the marketing concept has to be understood throughout the company, e.g. in the
production department of a manufacturing company as much as in the marketing department
itself. The company must also take account of the existence of competitors, who always have to
be identified, monitored and defeated in the search for loyal consumers.

3 Rather than risk launching a product or service solely on the basis of intuition or guesswork,
most companies undertake market research (GB) or marketing research (US). They collect and
analyse information about the size of a potential market, about consumers’ reactions to particular
product or service features, and so on. Sales representatives, who also talk to customers, are an
important source of information.

4 Once the basic offer e.g. a product concept has been established, the company has to think
about the marketing mix, i.e. all the various elements of a marketing programme, their integration,
and the amount of effort that a company can expend on them in order to influence the target
market. The best known classification of these elements is the ‘Four Ps’: product, place,
promotion and price. Aspects to be considered in marketing products include quality features
(standard and optional), style, brand name, size, packaging, services and guarantee. Place in a
marketing mix includes such factors as distribution channels, locations of points of sale, transport,
inventory size, etc. Promotion groups together advertising, publicity, sales promotion, and
personal selling, while price includes the basic list price, discounts, the length of the payment
period, possible credit terms, and so on. It is the job of a product manager or a brand manager to
look for ways to increase sales by changing the marketing mix.

5 It must be remembered that quite apart from consumer markets (in which people buy for
direct consumption) there exists an enormous producer or industrial or business market,
consisting of all the individuals and organizations that acquire goods and services that are used
in the production of other goods, or in the supply of services to others. Few consumers realize
that the producer market is actually larger than the consumer market, since it contains all the raw
materials, manufactured parts and components that go into consumer foods, plus capital
equipment such as buildings and machines, supplies such as energy and pens and paper, and
services ranging from cleaning to management consulting, all of which have to be marketed.
There is consequently more industrial than consumer marketing, even though ordinary
consumers are seldom exposed to it.
 77
II Summarize each paragraph with the help of these prompts.
The difference between the selling concept and the __________ concept is ________
__________________________________________________________________.

Market opportunities cannot be filled without first identifying the ___________________

To do that, businesses need to __________________________________________.

Before launching a product ________________________________________________.

The marketing mix is useful for _______________________________________________

_____________________________________________________________________

The difference between consumer markets and _________________________________

is ______________________________________________________________________

III Match up the words or expressions on the left with the definitions on the right.
1 to launch a A places where goods are sold to the public – shops, stores, kiosks,
product market stalls, etc.
2 market B an idea for a new product, which is tested with the target customers
research before the actual product is developed
3 points of sale C collecting, analysing and reporting data relevant to a specific
marketing situation (such as a proposed new product)
4 product D someone who contacts existing and potential customers, and tries
concept to persuade them to buy goods or services
5 sales E to introduce a new product onto the market
representative

Source: Ian Mackenzie: English for Business Studies. 2nd edition, CUP, 2002

IV Fill in the gaps with words from the text.

1 Grey power, DINKS (Double Income No Kids) and YUPPIES (Young Upwardly-mobile
Professionals) are all types of market s____________.
2 Our company chose DINKS as the t____________ market for our newest product.
3 Some companies don’t do market r____________ before launching a product. As a result,
many of these products fail.
4 The marketing m____________ has to be set when the product is first l____________ and
then changed during the life of the product.
5 Mobile phones with large screens and buttons s_______________ the needs of the elderly:
these are phones that they can handle easily.
6 The choice of what kind of d_____________ channel to use when selling a product can affect
the final price of the product.

The marketing mix

I Put these terms into four groups:
logistics, payment plans, retail price, personal selling, item/service, variety,
distribution channels, bonuses, quality, sales promotion, brand, sponsorship,
delivery, design, discounts, package, credit terms, retail locations, advertising,
public relations (PR)

P P P P
 78
II How would you change the marketing mix to increase sales of these product? Give
reasons for your choice.

1 Your attractively priced, good quality diving gear doesn’t sell

well despite all your advertising efforts. Your main outlets are in Osijek
and Karlovac.
2 Your company launched a new parfume intended for the up-
market consumer. Its price competes with Rexona.
3 You opened a new restaurant on Vir and decided to advertise it
in Jutarnji List.
4 You sell flat pack furniture, which means that consumers need
to assemble the items themselves. You receive complaints that this is
very difficult.

THE FOUR MAJOR PROMOTIONAL TOOLS

I Insert the following words in the text below.

advertising aimed awareness channel loyalty

maturity medium tactics target trial

1 The basic idea behind the ‘marketing concept’ – that you make what you can sell, rather than
sell what you make – does not mean that your product will sell all by itself. Even a good,
attractively priced product that clearly satisfies a need has to be made known to its (1)
______________ customers. During the introduction and growth stages of the standard product life
cycle, the producer (or importer, and so on) has to develop product or brand (2) ______________ i.e.
inform potential customers (and distributors, dealers and retailers) about the product’s existence, its
features, its advantages, and so on.

2 According to the well-known ‘Four Ps’ formulation of the marketing mix (product, place,
promotion and price), this is clearly a matter of promotion. Since budgets are always limited,
marketers usually have to decide which tools – advertising, public relations, sales promotion, or
personal selling – to use, and in what proportion.

3 Public relations (often abbreviated to PR) is concerned with maintaining, improving or

protecting the image of a company or product. The most important element of PR is publicity
which (as opposed to advertising) is any mention of a company’s product that is not paid for, in
any (3)______________ read, viewed or heard by a company’s customers or potential customers,
aimed at assisting sales. Many companies attempt to place stories or information in news media
to attract attention to a product or service. Publicity can have a huge impact on public
awareness that could not be achieved by advertising, or at least not without an enormous cost. A
lot of research has shown that people are more likely to read and believe publicity than
advertising.

4 Sales promotions such as free samples, coupons, price reductions, competitions, and so on,
are temporary (4) designed to stimulate either earlier or stronger sales of a
product. Free samples, for example, (combined with extensive advertising), may generate the
initial (5) of a new product. But the majority of products available at any
given time are in the (6) stage of the life cycle. This may last many years, until the
product begins to be replaced by new ones and enters the decline stage. During this time,
marketers can try out a number of promotional strategies and tactics. Reduced-price packs in
supermarkets, for example, can be used to attract price-conscious brand-switchers, and also to
counter a promotion by a competitor. Stores also reduce prices of specific items as loss leaders
which bring customers into the shop where they will also buy other goods.
5 Sales promotions can also be (7) at distributors, dealers and retailers, to 79
encourage them to stock new items or larger quantities, or to encourage off-season buying, or the
stocking of items related to an existing product. They might equally be designed to strengthen
brand (8) ________________ among retailers, or to gain entry to new markets. Sales promotions
can also be aimed at the sales force, encouraging them to increase their activities in selling a
particular product.

6 Personal selling is the most expensive promotional tool, and is generally only used sparingly,
e.g. as a complement to (9) . As well as prospecting for customers, spreading
information about a company’s products and services, selling these products and services, and
assisting customers with possible technical problems, sales people have another important function.
Since they are often the only person from a company that customers see, they are an extremely
important (10) of information. It has been calculated that the majority of
new product ideas come from customers via sales representatives.
Source: MacKenzie, English for Business Studies, 2002

II Read the text again and summarize the main ideas with the help of the prompts below:
The reasons for promoting a product is ____________________________________
4 major promotional tools: ______________________________________________
The main purpose of public relations is ______________________________________
Sales promotions are useful for________________________________ when aimed at
consumers.
Sales promotions are sometimes aimed at distributors to ________________________
or at the sales force to __________________________________________________.
The key factor in personal selling is _________________________________________

III Sort these examples of promotional techniques into 4 groups.

Free samples, newspaper ads, sales representative, loss leaders, blogs,
TV commercials, price reductions, publicity, competitions, posters, sponsorship,
2 for the price of 1, coupons

IV Which promotional tool does each statement refer to?

1 It is used for mass-produced products which are identical to each other. _______________
2 This promotional tool mainly serves to improve public opinion about the company or product.
_________________
3 The buyers need a lot of customer support to be able to use the product correctly. The after-
sales service is an important part of the package that consumers purchase.
_______________
4 It is often used for cheap goods that can be easily given away without costing the company
too much. _________________
5 The firm doesn’t have direct control over the message that goes out to the target customers.
_________________
6 The target market is very large and is possibly spread over a wide territory. _____________
7 This is the most expensive promotional tool if we look at the amount of time and energy spent
on a single sale. _________________
8 It is used to convince potential customers to try the product for the first time by offering them
an opportunity to taste or sample the product. _________________
 PRACTICE 80

I There is a logical connection among three of the four words in each of the following
groups. Which is the odd one out, and why?

1 advertising – competitors – publicity – sales promotion

2 advertising agency – advertising campaign – media plan – word-of-mouth advertising
3 advertising manager – brand-switcher – marketing manager – sales rep
4 after-sales service – guarantee – optional features – points of sale
5 brand awareness – brand loyalty – brand name – brand preference
6 competitions – coupons – free samples – line-stretching
7 credit terms – discount – list price – packaging
8 decline – growth – introduction – product improvement
9 size – shape – retail – quality
10 packaging – place – product – promotion

II Solve the puzzle by entering the missing half of the word partnership.

Across Down
2. ... the image of the company 1. sales ...
4. ... leader 3. ... trial of a product
5. ... stronger sales 4. ... cycle of a product
7. off-season ... 6. ... customers
8. ... information 7. ... awareness
10. ... attention 9. ... force
 81
REVISION 4
Products, Marketing, Promotional tools, Advertising

I Read through this list of terms and decide which terms belongs to which category. Some
might fit in more than one place, others might not fit anywhere.

selling concept, introduction, payment terms, product (item), marketing concept, place, market
opportunities, target market, billboards, price, PR, advertising agency, growth, market
segmentation, discounts, corporate branding, brand name, maturity, competitors, promotion, size,
personal selling, market share, product differentiation, launching a product, product mix, market
research, product features, penetration pricing, distribution channels, sales promotion,
competitions, advertising strategy, sales representatives, points of sale, marketing mix, decline,
online advertising, four Ps, advertising, basic list price, consumer market, producer market ,
logistics, free samples, advertising campaign, the life cycle of the product, multi-brand strategy,
newspaper ads, coupons, packaging, individual branding, product line, brand value, sales volume,
skim pricing, brief, media plan, viral marketing

marketing mix

some elements of
each P in the 4Ps

the stages of the

life cycle of the
product

elements of a
company’s
product mix

types of branding
strategies

pricing strategies

II Look at the words in task I again and …

a) explain their meaning in your own words.
b) use each in a sentence.
 82
III Explain the difference between the following concepts:

1 marketing / promotion
2 advertising / promotion
3 product / service
4 consumer markets / producer markets
5 personal selling / sales promotion
6 PR / sponsorship
7 brand awareness / brand loyalty
8 brand switching / brand loyalty
9 brand name / logo
10 introduction stage of the product’s life cycle / maturity stage of the product’s life cycle
11 promotional activities in the growth stage of the product’s life cycle / promotional activities in
the decline stage of the product’s life cycle
12 media plan / advertising strategy
13 skim pricing / penetration pricing
 83

12 SKILLS REFERENCE
12.1 NOTE-TAKING AND NOTE-MAKING

INTRODUCTION
I Read this job as advertised in the Economist and identify the skills required for this
position.

EUROPEAN CENTRAL BANK

The European Central Bank (ECB) established in Frankfurt am Main on 1 June 1998, is seeking to fill the vacancy
below in the Monetary Policy Stance Division in the Directorate Monetary Policy in the Directorate General
Economics of the ECB.

The ECB has its own terms and conditions of employment, including a competitive salary structure, retirement
plan, health insurance and relocation benefits.

ECONOMIST

(Ref.:ECB/181/04/ECO)

Qualifications and experience:

 Advanced university degree in economics, together with a sound academic record in applied
macroeconomics, preferably related to monetary and financial economics and central bank operations. A Ph.D.
and a research and publication record would be considered additional assets.
 Comprehensive experience in preparing policy-related briefing and analytical material, in particular on
issues associated with monetary policy implementation, the money markets, the operational framework of the
Eurosystem and related central banking issues.
 Excellent analytical skills
 Sound knowledge of statistical and econometric techniques for analytical purposes
 Candidates should have good writing skills in English and the ability to draft well-structured notes within
strict deadlines. They should also be able to identify and address policy issues and present analytical findings in
non-technical terms.
 A very good knowledge of English and a working knowledge of at least one other official community
language are required.
Starting date: As soon as possible.
Term of contract: Initially three-year fixed-term contract, which may be converted later into a permanent
contract.
Applications:
Applications should be submitted in English and include a covering letter, curriculum vitae and a recent
photograph together with references confirming the required experience and skills. They should be addressed,
quoting the reference number, to the European Central Bank, Recruitment and Staff Development Division,
Postfach 16.03.19., 60066 Frankfurt am main, Germany and should reach the ECB no later than 8 October 2004.
The deadline will be strictly adhered to.
Candidates must be nationals of the member State of the European Union.
Applications will be treated in the strictest confidence and will not be returned.
This vacancy has also been posted on the ECB's website at www.ecb.int. To meet the deadline, a copy may be
sent by fax to +49 697 344 7979 or by e-mail to [email protected]. However, a signed application must still be
sent by post.
 84
II Discuss these questions:

When are notes taken?

Notes are taken while

... reading a text

... listening to a lecture or presentation
... attending a meeting
... interviewing a candidate
... making slides for a presentation

Why are notes taken?

 information is the basis of decision-making in business

 managers are swamped with information
 notes communicate information in a shortened, time-saving form
 note-taking is a useful skill in business communication (e.g. minutes, reports,
articles, presentations, meetings…)

How are notes taken while reading?

Follow this 5-step procedure:

1) SKIM- get the rough idea of the content (title, pull quote, introductory paragraph,
pictures?)

2) SCAN underline the main points: key words/key sentences (topic sentences),

3) GIVE HEADINGS to each paragraph

4) GROUP PARAGRAPHS (how many parts of the text? headings, subheadings?)

5) ESTABLISH LOGICAL RELATIONS between parts of the text

How are notes taken while listening?

There are many methods to take notes. The Cornell method is an example of note-taking.

What is note-making?

Preparing the notes for the user. When organizing the notes it is important to:
 know the purpose of the notes

 establish priorities to separate the essential, the useful and the irrelevant (key

words, key sentences, major concepts)

 show clear structure which emphasizes the underlying conceptual relationship

(visual appeal through graphics: headings, subheadings, bold, indent, underline,

italics, mind maps, charting, etc.

 85
How can notes be organised more clearly?

Use symbols and abbreviations instead of full words whenever possible.

FUNCTIONS FULL TEXT SUGGESTIONS

FOR NOTES

Examples For example,… For instance,…As an e.g.

(illustrations) example,… To illustrate the point,…

Listing or giving There are three reasons why… 1

another argument First,…Second,… Third,…Firstly, … 2
Secondly, … Thirdly, …
3
Furthermore, … Moreover, … Also,…

Clarifying In other words, … that is… i.e.

Reason, cause – because →

effect (of)…therefore…consequently…owing
to…due to…thus…since…

Contrast, however, on the contrary, nevertheless, vs.

opposition conversely, yet, although, even though,
though, on the other hand

III Study these notes on the text Where did all the jobs go? on p. 31.

I MANUFACTURING JOB MOVEMENTS (pg. 1)

Before 1970s vs nowadays

GB – manufacturing → China, …

II MORE EVIDENCE (pg. 2)

US (rust-belt) vs. China

European shipyards South Korea

Steel, coal

III NOT MANUFACTURING ONLY (pg. 3)

Also: knowledge –based services: high-tech (telecom, computers, aeronautics),

pharmaceuticals

Conclusion: jobs in developed countries are no longer safe

 86
12.2 PARAGRAPHING
I Study the key features of paragraphs and underline the main ideas.

PARAGRAPH

 A paragraph usually consists of three or more sentences based on one main topic, so
you should start a new paragraph when you change topic.
 Individual sentences within a paragraph should be connected using sequencing words
(e.g. firstly, then, finally), reference words such as pronouns (e.g. which, where, that) or
linking words (e.g. therefore, however). However, if they are overused, the text will
sound unnatural and be difficult to follow.
 One-sentence paragraphs should be avoided, whenever possible.
 A line space should be left to show where one paragraph ends and another begins.

Adapted from: Stephens, M. (2002) : New Proficiency Writing. 2nd ed. Pearson Education Limited

THE STRUCTURE OF A PARAGRAPH

1 Usually the first sentence in a paragraph is the topic sentence. This states the main idea,
point, opinion to be discussed in the paragraph.
2 The following are the supporting sentences which provide explanations, evidence and
support for the topic sentence (main idea).
3 The concluding sentence restates the main idea and reinforces the point or opinion.
4 The transitional sentence prepares the reader for the following paragraph.

II Study the following paragraph. Find the different types of sentences listed above.

Students require more recreational time in order to better focus on lessons in class. In fact,

studies have shown that students who enjoy a recess of more than 45 minutes consistently

score better on tests immediately following the recess period. Clinical analysis further suggests

that physical exercise greatly improves the ability to focus on academic materials. Longer

periods of recess are clearly required to allow students the best possible chances of success in

their studies. Clearly, physical exercise is just one of the necessary ingredients for improving

student scores on standardized tests.

Adapted from: Singh, M., Singh, O.P. ISC Art Of Effective English Writing. New Delhi: S. Chand & Co. p. 10-11
 87
III Tick () the linking words and phrases you know.

●although ●for example ●however ●because ●and ●due to

●owing to ●furthermore ●therefore ●thus ●on the contrary ●so
that ●for instance ●but ●because of ●moreover ●even though
●for example ●since ●so ●whereas ●while ●nevertheless
●in addition to ●that's why ●as a result ●consequently ●in spite of ●besides
●despite ●in order to ●on the other hand ●yet

IV Study how the following linking words and phrases are used (at the beginning,
in the middle or at the end of a sentence)? What is their function?
1 Although I understand Martin’s motives for doing this, I do not approve of his methods.
2 The company provides good working conditions. In addition, it offers excellent training
opportunities for young employees.
3 The government has recently introduced incentives for employers to hire new people
in order to reduce unemployment.
4 Your comment was funny. It was, nevertheless, a bit unprofessional.
5 Despite going beyond our limits, we did not manage to finish the project on time.
6 The company has severe financial difficulties, and therefore a lot of employees have
been laid off recently.
7 Since you are unable to answer our questions, perhaps we should ask some of your
colleagues.
8 Life in the urban environment is often considered to be more exciting whereas living in
the countryside provides more opportunities for healthier lifestyle.
9 We should all be more cautious about energy consumption. For instance, we could
travel to work by bicycle instead of driving a car.
10 The school was far away from my hometown. Besides, it was too expensive.
11 Many people would like to do a challenging and creative job. On the other hand, most
people would always choose the job that is well-paid.
12 Owing to unexpected circumstances, we had to cancel our trip to London.

V Copy the linking words and phrases from the box above next to the
corresponding functions:

ADDITIONAL INFORMATION

REASON

CONTRAST

PURPOSE

RESULT/CONSEQUENCE

GIVING EXAMPLE

CONCESSION
 88
VI Read the text on trade unions and fill in the missing linking words.

though, because, due to, whereas, consequently

Declining unionism in the United States

One of the major trends in American labor markets has been the gradual erosion of labor unions
since World War II. ______________ unions had organized one-quarter of the labor force in 1955,
the fraction has fallen sharply since 1980. The share of unionized workers in manufacturing has
shrunk dramatically in the last two decades; only in the public sector are unions a powerful force.

One of the reasons for the decline in unions is the waning power of the strike, which is the ultimate
threat in collective bargaining. In the 1970s U.S. labor unions used that weapon regularly,
averaging almost 300 strikes per year. More recently, _____________ , strikes have become
relatively uncommon; in fact, they have virtually disappeared from the American labor market. This
is _____________ the fact that strikes have often backfired on workers. In 1981, the striking air-
traffic controllers were all fired by President Reagan. […] In 1992, workers striking at Caterpillar
Inc., a huge maker of heavy equipment, had to end their 6-month strike ______________
Caterpillar threatened to fill their jobs with permanent replacements. ______________ the inability
to hurt firms through strikes has led to a significant weakening in the overall power of labor unions
in the previous two decades.
Adapted from: Samuelson, P. A., Nordhaus,, W. D. (2010). Economics. International Ed. New York: McGraw-Hill, p. 260

VII Identify the structure of the second paragraph. Use terms such as:

topic sentence, explanation, contradiction, example, consequence,

background, concluding sentence

Sometimes a sentence can have more than one role!

Paragraph 1
1 topic sentence
2 contradiction
3 explanation/concluding sentence

Paragraph 2
1
2
3
4
5
6
7

VIII Choose two questions and write the topic sentence that you would begin your
answer with.
1 How did the Friedmans define economic freedom?
2 What is the difference among flat, progressive and regressive taxes?
3 Why do governments privatize?
4 Why do people worry about the decline of manufacturing?
5 Explain why the private sector is uninterested in providing public goods?
 89
PRACTICE

I Use the following sentences to write a paragraph about world tourism.

Organise the sentences into logical order by using the necessary connectors and
linking words.

The travel industry usually recovers very quickly, but will this always be the case in the

future? Tourism has become one of the world's biggest industries. In an increasingly

dangerous world, especially with an ever present threat of terrorist attack, people may not

be willing to travel as much as they used to. Estimates suggest that 590 million people

travel abroad every year, sometimes several times, not only for holidays but also for

business, and for personal, religious, or health reasons. After September 11th, there are

fewer Americans travelling, which has been disastrous for some global tourist economies.

It accounts for 11% of global GDP and employs around 200 million people.

Adapted from T.Byrne: Intermediate English File, Business Resource Book, 2nd ed., 2004, Oxford UP
 90
12.3 BUSINESS MEETINGS
1 Introduction
2 The structure of meetings
3 The language of meetings
4 Downtoning
5 Role-play
6 Memo, agenda and minutes

INTRODUCTION

I Discuss these questions before reading the text.

1 Why are business meetings usually held?

2 What are the typical problems associated with meetings?
3 What makes meetings effective?
4 What is the role of the chairperson in a meeting?

II Read the text and find out.

EFFECTIVE BUSINESS MEETINGS

The functioning of many business organizations today relies heavily on complex work
organization, which requires effective communication between different departments, layers of
management, customers and business partners. In other words, it is really difficult to imagine a
modern workplace in which people don’t spend any time in meetings, either to discuss critical
issues, solve problems or make important decisions.

Although thousands of business meetings are held every day, not all of them are effective.
Ineffective meetings usually have no clear purpose, take too much time and produce no clear
outcomes. The chairperson of the meeting is probably the first to blame for an unsuccessful
meeting because if s/he does not prepare well, the discussion easily gets sidetracked and
participants lose focus and interest. Many business people often complain that meetings can
really be a waste of their precious time.

No wonder then that effective and productive meetings are everyone’s goal. Successful
meetings are usually well-planned, have a clear purpose and follow-up. When preparing the
meeting, it is important for the chairperson to announce the meeting in good time, state the
venue and circulate the agenda. The agenda contains the items which will be discussed in a
meeting so that people who attend the meeting can prepare in advance.

The chairperson opens, runs and concludes the meeting. He or she makes sure that all
participants are included in the discussion. She or he allocates time for each item to keep the
discussion on track. It is very important to assign responsibility for each action point discussed
so that all participants know what they are expected to do after the meeting. The chairperson
can appoint a minute taker who will take the minutes, or write down the most important things
said at the meeting. When most items on the agenda have been discussed, the chairperson
asks if there is any other business, often abbreviated to AOB, and closes the meeting.

If the meeting is well-planned and well-chaired, participants will be able to present information,
contribute their ideas and proposals and express their opinions. For meetings to be really
productive, many different arguments need to be heard so that listening to speakers, asking
questions and offering counterarguments are all welcome steps in the process of reaching
consensus or the final decision.
 91
III Find the words in the text for these definitions.

1 the last item on the agenda, usually used as an abbreviation

2 a place where the meeting is held
3 one subject or issue discussed in the meeting
4 a person who writes down the things said and decided at the meeting
5 a list of subjects to be discussed in the meeting
6 a person who is in charge of the meeting
7 an official written record of what is said and decided at the meeting

IV Complete the sentences with the missing verbs below.

attend run discuss contain state

announce make circulate solve

1 In business meetings participants ____________ different issues, _____________

problems and ____________decisions.
2 If the chairperson doesn't know how to _____________ the meeting well, the meeting will
probably lose focus.
3 The chairperson should ____________ the meeting in good time, _____________ the
venue and _____________ the agenda.
4 Agendas _______________ items to be discussed so that those who _____________ the
meeting can prepare in advance.

V Complete the sentences with the missing nouns.

1 The chairperson usually appoints the _______________ who writes down the most
important points from the meeting.
2 A good chairperson should allocate ______________ for each item to keep the meeting on
track.
3 It is important to assign ____________ to participants who are in charge of a certain action
point.
4 In some meetings participants vote in favour of or against a ______________.
 92
LISTENING
https://www.youtube.com/watch?v=L_kZT8t75J4
MEETINGS – The role of the Chairperson

I Listen and fill in the gaps2.

DENISE: Has everybody got a copy of the ________________?
Would you mind ___________________ minutes John?
JOHN: Not at all.
DENISE: Good. Well, then let's ________________ started.
First of all, thank you everyone for _________________ at short notice.
As you know, the _________________ of this meeting of the Capital Works Committee is to
_____________ a proposal for some urgent building work at our Southside plant. As we've got to
_______________ a decision which may involve spending, we'll ______________ it as a formal
meeting. Now, you've read the proposal, so without further ado, I'd like to _______________ it up
for discussion.
Perhaps if we can start with you Tan – what's your ________________?
TAN: Well, I'm not convinced that the work is as urgent as this report suggests, so perhaps we
should…
DENISE: So, to _________________ up – I think we are all aware that some urgent work does
need to be done, and we will need to work on a longer term plan for a major refit.
Well, if there's no more discussion – we'll ____________ it to a vote. We're recommending that
tenders be called for the urgent work needed. All those in favour? All those against?
Then that's agreed... Any other ______________?
Then we'll ____________ the meeting. Thank you everyone. The next meeting will be in two
weeks, at the same time…
II Find word partnerships that mean:
keep a written record of a meeting: ___________________________________
talk about a suggestion: ___________________________________
arrive at a decision, make a decision: ___________________________________
vote on something: ___________________________________
III Find expressions in the text that mean:
with only a little time given to do something, very quickly: ________________________________
not wasting any time: ___________________________________
people who vote for something: ___________________________________
people who are opposed to something, vote ___________________________________
something.
IV Fill in the gaps with the expressions from above:
Croatia voted _________________ of joining the EU.
I can't cancel my arrangements ____________________, I need to be told of changes at least a
week in advance.
The time has come to leave, so ______________________, good evening and good-bye.

2
Source: http://australianetwork.com/businessenglish/stories/ep04.htm
 93
V Tasks of a chairperson: Find these sentences in the text and decide what function
they have in a meeting:

Sentences Functions:
1. Has everybody got a copy of the agenda? A. Thanking people for
2. Would you mind taking minutes John? attending the
3. Well, then let’s get started. meeting.
4. First of all, thank you everyone for attending at short notice. B. Asking people to
speak.
5. As you know, we needed to convene this meeting of the C. Closing the meeting.
Capital Works committee to discuss a proposal … D. Summarizing the
6. I’d like to open it up for discussion. discussion (concisely
7. Perhaps if we can start with you Tan – what’s your view? stating the main
points made during
8. So, to sum up … the meeting).
9. Let’s put the recommendation to a vote. We’re recommending E. Stating the objective
tenders be called for the urgent work needed. All those in of a meeting.
agreement? Anyone against? F. Starting a meeting.
10. Then we’ll close the meeting. Thank you everyone. The next G. Inviting discussion.
meeting will be in two weeks, at the same time. H. Putting the
recommendation of
the meeting to a vote.

VI What is the function of these sentences? (Choose the functions from exercise V)

Sentences Function
1 Has everybody got a copy of the agenda?
2 Does everyone have an agenda?
3 Everybody should have received an agenda.
4 Would you mind taking minutes John?
5 Could somebody take the minutes please?
6 We’re here today to discuss a proposal…
7 The purpose of our meeting today is to discuss the following
proposal…
8 Who’d like to start the discussion?
9 What’s your view Tan?
10 Let’s hear from Tan.
11 Do you have a view on this Tan?
12 In summary…
13 So the main points are…

VII How can you address the Chairperson of a meeting?

1. _____________________________,
2. _____________________________,
3. _____________________________,
4. _____________________________,
5. _____________________________
 94
THE STRUCTURE OF MEETINGS

I Look at the table below. How many parts does the meeting consist of? Then
tick the corresponding box next to each function depending on who does it: the
chairperson, participants or both?

HOW TO BEGIN?

FUNCTION CHAIRPERSON PARTICIPANTS

☐ start the meeting √

☐ welcome the participants

☐ introduce everyone if necessary

☐ state the objective of the meeting

☐ go through the agenda

☐ say when the meeting will finish

WHAT HAPPENS DURING THE MEETING?

☐ ask for opinion

☐ state an opinion

☐ comment on opinion

☐ (dis)agree

☐ ask for clarification

☐ interrupt

☐ express doubt

☐ make a suggestion

☐ check understanding

☐ keep to the agenda

☐ vote
HOW TO END THE MEETING?

☐ conclude the main points

☐ summarize

☐ emphasise action points

☐ close the meeting

 95
THE LANGUAGE OF MEETINGS

I Read the useful phrases used in the meeting and copy the phrases from the box below
in the appropriate place in the table.

The purpose of this meeting is to… I couldn’t agree more. Why don’t we…?
I think we’ve covered everything. I see what you mean. Just let me finish…

AT THE BEGINNING USEFUL PHRASES

☐ start the meeting Let’s get started.
We’ve got a very tight agenda, so we’d better get down to
business.
☐ welcome the participants I’m very glad to welcome you here (on behalf of…)
Thank you all for coming here today.
☐ introduce everyone if This is XY. She is in charge of…She deals with…
necessary Let me introduce you to…
☐ state the objective of the We’re here today to…
meeting 1 _______________________________________________
☐ go through the agenda There are three items on the agenda. Firstly, we’ll deal with…
Secondly, we’ll…,Thirdly,… Finally,…
☐ say when the meeting will I’d like to finish by…
finish The meeting is due to finish by…
DURING THE MEETING USEFUL PHRASES
☐ ask for opinion What do you think about this?
What’s your opinion on this?
☐ state an opinion In my opinion,…
If you ask me,…
☐ comment on opinion That’s a good point.
So, what you’re saying is…
2 _______________________________________________
☐ disagree I’m afraid I disagree.
I have to disagree.
It’s out of the question!
☐ agree I agree completely.
That’s a good idea!
3 _______________________________________________
☐ ask for clarification What exactly did you mean by…?
Could you be more specific about…?
Could you please elaborate on that?
☐ interrupting and dealing Excuse me, may I interrupt?
with interruptions Can I just finish what I was saying…?
4 _______________________________________________
☐ express doubt I agree to some extent, but…
I suppose you’re right but…
☐ make a suggestion I think we should…
5 _______________________________________________
☐ check understanding Is that clear everyone?
☐ keep to the agenda Let’s now move on to the next item on the agenda.
We’ll come to that later.
☐ vote Let’s put this to a vote. Everyone in favour of this proposal?
Against?
AT THE END USEFUL PHRASES
☐ conclude the main points Let’s go over the main points again.
So, we’ve agreed that…
As far as…is concerned, we’ve agreed that…
☐ summarize So, to sum up…
☐ emphasise action points Ana is in charge of completing the report by 14 January.
So John, can you please write the report?
☐ close the meeting That brings us to the end of our meeting today.
6 ________________________________________________
 96
II In which part of the meeting will you hear the following?

Let me introduce you to… If I understand you correctly… We’ve got a very tight
agenda, so we’d better
get down to business…

The meeting is due to It’s out of the question… We’ll deal with … first,
finish by… then we’ll discuss…, and
finally we’ll…

Thank you for coming To recap, John, you’re in charge of The objective of today’s
here… the report. Ann is in charge of the meeting is …
draft plan. Sue will inform the team,
right?

III Match the phrases that are similar in meaning.

1 I couldn't agree more. ☐ I agree to some point, but..

2 What's your opinion? ☐ Why don't we buy from ABC Ltd.?

3 I agree to some extent, but... ☐ As far as this item is concerned, we’ve agreed
that…
4 I see what you mean. ☐ I totally agree.

5 Ann is in charge of the report. ☐ What do you think about this?

6 So, we’ve agreed that… ☐ I see, what you're saying is ...

7 To summarize the meeting… ☐ Ann is responsible for writing the report.

8 I advise you to buy from ABC Ltd. ☐ To sum up,…

IV Fill in the gaps in this introduction to a meeting.

Good morning, everyone. Are you all here? OK....

Let's get s_____________ then. Thanks for c_____________ to today's meeting.
Have you all got a copy of the a_____________? Good.
As you can see, we've got a very t_____________ agenda today so I suggest we get down to
b_____________.
The p_____________ of today’s meeting is to decide what we can do to improve the financial
situation of the company.
So, first we'll d_____________ with the financial report.
T_____________, we'll have a look at Simon's proposal for consolidation. I'd like to hear
everyone's o_____________ on the proposal then.
Finally, we'll m_____________ a decision on the financial plan for the next quarter.
I think we should spend around 15 minutes on each i_____________, so we’ll finish by 3.
 97
DOWNTONING

I Sort out these phrases:

Absolutely! I don’t quite agree. That’s out of the question! That’s absurd!
I suppose so. Exactly! That’s true, I guess. That’s not really how I see it.

MILD MILD STRONG STRONG

AGREEMENT DISAGREEMENT AGREEMENT DISAGREEMENT

II React to this sentence from a meeting using the prompt from the bracket.
I believe that our department should be given more freedom to make decisions.
1 (disagree mildly)
_____________________________________________________________.
2 (disagree strongly)
___________________________________________________________.
3 (ask for clarification)
__________________________________________________________.
4 (agree mildly)
_______________________________________________________________.
5 (agree strongly)
_____________________________________________________________.

III What are the implications of aggressive language for a business deal? Read the text
and study the table below.

“You must reduce the price or else…!”

If you want to be an effective communicator, you should know how to soften your points by
avoiding aggressive, uncompromising and confrontational language.
Remember that in effective business meetings it is important to make your point firmly but
politely.

SOFTEN BY USING: EXAMPLE:

☐ WE / LET’S Let’s reconsider the price, shall we?

We could reduce the price.
☐ PERHAPS / MAYBE Perhaps we could reduce the price.

☐ A BIT / JUST / A LITTLE / The price is a little bit high, don’t you think?
SLIGHTLY Can we reduce the price slightly?

☐ WOULD / COULD / MAY / MIGHT The price may / might be a bit lower.
It could / would be a good idea to lower the price
☐ PLEASE Please confirm your attendance via e-mail.

☐ I’M AFRAID I’m afraid the price is too high.

☐ “NOT” AS A MODIFIER It wouldn’t be bad if the price was lower.

☐ Using NOT with a POSITIVE The price is not very affordable.

WORD instead of the obvious The product is not too affordable.
negative word.
☐ Turn it into a QUESTION Could you lower the price?
Would it be possible to lower the price?
 98

IV Match up the polite and the impolite versions of the sentences.

1 Your terms are unacceptable A) I’m afraid you might have misunderstood
what I’ve said.
2 You must send it straight away. B) It seems there is a small mistake in the
report.
3 Your product’s quality is very poor. C) Please could you send it as soon as
possible?
4 I never said that, you are lying! D) I was wondering if you could change your
terms slightly.
5 You made a mistake in the report. E) The quality is not as high as we expected.

V Rewrite the following sentences by using the words and phrases in the brackets.

1 We won’t give you a discount (afraid).

_______________________________________________________________________.
2 You must finish the report! (please)
_______________________________________________________________________.
3 Your prices are way too high. (a little bit)
_______________________________________________________________________.
4 These figures are false! (not)
_______________________________________________________________________.
5 He is not available. (afraid)
_______________________________________________________________________.
6 So, we’ll find another buyer! (perhaps)
_______________________________________________________________________.
 99
VI Read the dialogues and underline different verb structures for making
suggestions.

A: It seems we have the wrong documents. A: I suggest that we should relocate next
B: I advise we contact the Berlin office year.
immediately! B: I completely agree.

A: Can we postpone the meeting? A: I suggest we read the draft now.

B. Yes, I suggest putting it off for next week. B. I agree.
A: I propose that we wait for the new scheme A: I suggest relocation.
to be put in place. B. That's out of the question!
B: You really propose waiting for another
month?
A: Who should we elect?
B: I propose Tom.

REMEMBER!

SUGGEST PROPOSE

☐ Suggest that someone do something ☐ Propose that somebody do something

☐ Suggest that someone should do
☐ Propose doing something
something
☐ Suggest doing something ☐ Propose somebody (in voting)
☐ Suggest something
BUT NOT: suggest to do something
suggest somebody to do something

ADVISE

☐ advise doing something

☐ advise somebody to do something

☐ advise that somebody do something

BUT: ADVISE (verb) ≠ ADVICE (noun)

VII Translate the following into English.

1 Predlažem da povisimo cijene.
2 Predlažem izvoz u Italiju.
3 Predlažem Johna.
4 Predlažem da ti vodiš zapisnik.
5 Predlažem da IT odjel preseli u novi ured.
 100
ROLE-PLAY

I Make groups of four. Read the situation first and assign roles.

SITUATION

Four managers are in a meeting to decide whether to lay off their colleague Ann. The reason why
Ann might be dismissed is that recently she hasn’t performed well and her abrasive style is
seen as offensive. If she is laid off, the managers need to decide how much severance pay to
give her.

ROLES

Students 1 and 2 think Ann should be dismissed. Think of additional details why she should be
fired.
Students 3 and 4 think Ann should stay because of her experience and work discipline. Think
of additional details why she should stay.

II Now role-play the meeting following the prompts below. The meeting should last about
5 minutes. The prompts below help you to get started, but as you go, invent more details
and finish the meeting yourselves. Remember what the purpose of the meeting is. Then
report your decision to the class.

Student 1: Good afternoon, everyone. I see we’re all here, so I suggest we get
down to business right away because I’d like to finish by 4.
Student 2: Excellent. I have another meeting to attend at 4.30.
Student 1: So, have you all got a copy of the agenda?
Students 2, 3, 4: Yes.
Student 1: Ok, we have to decide if we should let Ann go. If we do, we have to
decide how much severance pay to give her.
So, to begin, you all realize that we need to cut costs and her recent
results are quite disappointing. What do you think, John?
Student 2: Ok, I think it is quite clear why Ann should go. First of all,
__________________________________________. Then,
__________________________________________.
Student 3: I’m afraid I can’t agree with you. Ann is one of the most experienced
workers __________________________________________. Besides,
she is __________________________________________.
And __________________________________________.
Student 2: Excuse me, may I interrupt? Look at her sales results from last months!
__________________________________________!
Student 4: Come on! Are you saying that she’s not a good worker? I think she is
doing all she can. But this crisis ______________________________.
Student 1: Hmm, true…
 101
MEMO, AGENDA AND MINUTES

I Study this sample memo and circle the correct word in the sentences on the right
outlining the basic rules for writing memos.

MEMO Memos are usually used for

internal/external communication.
To: All department heads
From: Mary Fitch, HR Manager
They should include the following
Date: 2 February 2014
headings: To, From, Date, and
Subject: Visit of Germanica Ltd. representative
Subject/Topic.
Please note that Sandra Keiths, a representative of
Germanica Ltd., a company specializing in offering They should be long/short and
Business German courses, will visit us on Friday, 5 include only relevant information.
February.

There will be a presentation of the courses, The tone of a memo may be/must be
followed by a meeting at 1 p.m. that you should all formal, informal or neutral.
attend.
It is usual to end with your full
If you wish to join us for lunch at a local restaurant, signature/initials.
please let me know as soon as possible.

MF
Adapted from: Market Leader Intermediate, p. 144, Longman.

II Study the agenda below and complete the explanation next to it.

Department Heads Meeting Agendas contain the following

information: the title, the date, and the
AGENDA ____________ (place).

Date: 5 February Larger or more formal meetings may

Time: 1 p.m. also include the following:
Venue: Room 12, Angus House a) Apologies for absence
b) Matters arising from last
1 Presentation: Germanica Ltd. meeting
2 Course organization c) Correspondence
3 AOB d) Date of next meeting.

____________ is reserved for other

Adapted from: Market Leader Intermediate, p. 144, Longman. relevant issues that were not included
in the agenda.

III Read the paragraph below and explain the main purpose of action minutes.

For most business meetings, action minutes are more useful than full minutes. Action minutes
are intended to make sure that decisions of the meeting are understood and carried out. There is
a brief summary of the discussion for each item on the agenda. The initials of the person
responsible for carrying out any action required are given on the margin, along with the deadline.
 102
IV Read the action minutes below. Then, explain the layout and the structure of the
action minutes by answering these questions:

1 What do the initials on the right margin stand for?

2 What do the dates on the right margin stand for?
3 Where do we include information about the time and the venue of the meeting?
4 What are action points and where are they included?

Minutes of the Department Heads' Meeting

_____________________________________________________

Date: 5 February 2014, 1 p.m.

Venue: Room 12, Angus House

Present: Mary Fitch, Christina Bilich (Germanica Ltd.), Joe Piscarelli, Ann
Murray, Vince Wallace

1 Presentation: Germanica Ltd.

Following the Board's decision to provide Business German courses for our
employees, the representative of Germanica Ltd. made a presentation of the
courses, detailing the necessary steps for the organization of the courses in
our premises. MF 10
FEB
We all agree that Mary Fitch should make the necessary arrangements with
Christina Bilich to organize classification testing. Department heads will be
informed about the time and place for testing of their employees.

2 Course organization

We agreed that the courses will be offered at different language levels on

JP
Mondays, Wednesdays and Fridays after 4 p.m.
AM
All department heads should rearrange their staff's regular work activity to
15
allow them regular attendance of the courses. These arrangements should
VW FEB
be sent to the HR Manager in a written form.

Next meeting: 8 February, 10 a.m.

Venue: To be confirmed
 103
PRACTICE

I Solve the puzzle by translating the Croatian terms to English

Across
1. predsjedati sastankom
7. zapisničar
8. odrediti zapisničara
9. razni (na dnevnom redu)
10. sazvati sastanak
11. dnevni red

Down
2. voditi zapisnik
3. konsenzus
4. odgoditi sastanak
5. mjesto održavanje sastanka
6. točka (na dnevnom redu)

II Fill in the gaps in this conversation from a meeting. The first letters will help you.

Chair: Ok, everyone. Let’s get s_____________. Does everybody have a copy of the
a____________? …
All right then. We are here today to d___________ the problem of sales. For three
months in a row we have seen a steady fall. So, I’d like us to focus on three issues
today.
First of all, we’ll look at our sales figures in the last quarter. After t__________, Mary will
give her projection for the next quarter on the basis of current trends. F____________,
I’d like to hear your proposals for reversing this negative trend.
Ann: Sorry to i____________, but I think we should discuss the performance of sales force as
well (…)
Chair: I’m sure Mary will mention that as she gives us the sales report. Right Mary?
Could you please take the m___________, Ann? (…)

Chair: (…) So, we’ve seen the sales figures. Let’s now m___________on to projections.
Mary: Thank you, well, as you can see from this g____________, sales will continue to fall. I
have to insist that my sales force are doing all they can …
Ann: E_________ me, but they are the most responsible…
Mary: In my o____________, we should blame the falling demand and not my sales force (…)
Chair: So to s_________up, the negative trend, I’m a___________, is going to continue. We all
a___________that we should focus on marketing more and perhaps consider cutting the
sales force.
So, if there are no more q____________, I’d like us to meet in 10 days’ time.
 104
12.4 BUSINESS CORRESPONDENCE
INTRODUCTION
I Discuss these questions.

1. Why is it important for business people to develop business correspondence skills?

2. Can you think of concrete situations where business correspondence may affect
business activities?
3. Do you think e-mails will completely replace business letters one day?
4. Why is it important to use standardised business formats, clear style and accurate
language in business correspondence?

FORMAL BUSINESS LETTERS – GENERAL GUIDELINES

I Study the key features of formal business letters.

LAYOUT
o BLOCK STYLE (see page 95)

COHESION AND ORGANIZATION

o Avoid paragraphs and sentences that are too long (too much information at once).
o Avoid incomplete information.
o Avoid information that is in the wrong order.
o A paragraph can have just one or more sentences in it and it should have one central
topic.

CONTENT
Most letters have three parts:
o AN OPENING, which says why you are writing,
o THE MAIN MESSAGE, which gives the details, and
o THE CLOSING, which usually refers to future contact.
Each part is usually a separate paragraph, but the main message can be more than one
paragraph if you are writing about more than one subject.

REGISTER AND STYLE

o The style if formal or semi-formal. (Revise what we learned about downtoning and polite
language.)
o Avoid contractions (I'm…) and colloquial expressions.
o Avoid short and direct phrases.
o Don't use language that you might use when you are speaking English.

ACCURACY (grammar, spelling and punctuation)

 105
II Study the following steps in letter writing.

1 Read carefully the letter you have received.

2 Make a plan for the letter.
3 Note down important/useful phrases.
4 Write a draft.
5 Check spelling, grammar, style and layout.
6 Make changes and corrections.
7 Produce a final version.
8 Read the letter again.
9 Send the letter.

REMEMBER!

Business correspondence should be:

 Complete – contain all necessary information

 Concise – brief
 Clear – easy to understand
 Correct – accurate both in content and language
 106
ELECTRONIC MAIL - GENERAL GUIDELINES

I Study the general features of electronic mail.

1. OPENING AND CLOSING

Your emails should always open (Dear…) and close properly (Yours…). This is a sign of
politeness and educated style, but it also tells the reader that the message is for them, and
not just a copy (cc or bcc), and that the message has finished.

2. SUBJECT HEADING
Many people do not open all the messages they receive because a lot of them are junk mail
so they delete them straight away. That is why it is very important to write a short subject
heading which makes it clear what the message is about and which encourages the reader
to open the message. This can also help to ensure that the message goes to the right
person.

3. UPPER/LOWER CASE
Avoid capitals in emails because they are considered the same as shouting. Similarly, don’t
write all in lower case.

4. COPYING THE ORIGINAL MESSAGE

In some replies to emails, parts of the original message are copied back to the addressee.
These parts are then marked with >. Sometimes, however, copying parts of the original
message into a reply can make an email look untidy, leaving a poor impression.

5. REPLY
Most commonly a reply to an email does not contain the original message, unless it is
important to do so. The person you are replying to will normally have a copy of their own
original message.

6. ATTACHMENT
Your email should always mention what you are attaching, because sometimes the receiver
is unable to open, download and convert the file attached.

7. PARAGRAPHS
Divide your message into meaningful paragraphs. It is more natural and certainly less tiring
to read several short paragraphs than one long one. Use a line space between your
paragraphs.

8. STYLE
Using the right style of writing can be a problem for inexperienced writers. The wrong style
might leave the wrong impression despite the writer’s intention. For that reason, remember
that email language should be natural and not very formal. However, informal language
should be used with caution, and is generally recommended only if you know the person
well. Avoid text-message abbreviations, slang and ‘emoticons’ (symbols which people often
use in Internet chat). It is always a good idea to check your email for language and style
before you send it. A badly spelled, poorly written e-mail can give a very negative
impression.
Adapted from A. Littlejohn: Company to Company, Fourth Edition, 2006, Cambridge University Press
 107
LAYOUT

I Compare the layouts of a BUSINESS LETTER and an E-MAIL. What is the

difference? Which elements are the same?

Outlook Express
Beewiz Co.
13 King Street To: [email protected]
Manchester M35
From: [email protected]
England
Cc: [email protected]
TRIPFINDER Co.
Subject: Trip to Split
4 Hawk Road
Manchester M35
Dear Sir or Madam
England
We are writing in connection with the above
Our ref: JG/st/4
trip.
5 June 2010
We would like to inform you that the number of
people interested in the trip has changed.
There are now 22 persons on the list.
Dear Sir or Madam
We hope that this has not caused you any
Trip to Split inconvenience.

We are writing in connection with the above Yours faithfully

trip.
John Gooding
We would like to inform you that the number of HR Manager
people interested in the trip has changed. Beewiz Co.
There are now 22 persons on the list. 13 King Street
Manchester M35
We hope that this has not caused you any England
inconvenience. www.beewiz.uk
Yours faithfully

John Gooding
John Gooding
HR Manager
 LAYOUT: BLOCK STYLE

I Study the layout of business letters, the “BLOCK STYLE”. How is

information organised? How are paragraphs separated? Where do
they begin?

Beewiz Co. SENDER'S

13 King Street ADDRESS
Manchester M35
England
RECIPIENT'S TRIPFINDER Co.
SENDER'S AND
ADDRESS 4 Hawk Road
RECIPIENT'S
Manchester M35
REFERENCES
England Our ref: JG/st/4

5 June 2010 DATE

OPENING Dear Sir or Madam

SUBJECT Trip toBUSINESS
Split LETTER LAYOUT
HEADING

BEGINNING
We are writing in connection with the above trip.

We would like to inform you that the number of

MAIN BODY
MESSAGE people interested in the trip has changed. There
are now 22 persons on the list.

ENDING We hope that this has not caused you any

inconvenience.
CLOSING
Yours faithfully
PHRASE

John Gooding
SIGNATURE
(WRITTEN AND John Gooding
TYPED) HR Manager

TITLE

II Copy the mixed-up sentences in the empty form below to write a correct
email. Divide the message into paragraphs leaving space lines. Add any other
necessary information, e.g. e-mail addresses etc.
Dear Mr Zorić 109

I look forward to hearing from you.

I hope to be in Zagreb on 18 and 19 October. Would it be convenient to visit you on 18

October at 10 a.m.?

Visit to Zagreb

I am now planning a trip to Europe and I would be very pleased if we could meet to discuss
the new technology you would like to introduce.

Marc Sullivan
Sales Manager
Export Division
www.buptech.co

Yours sincerely

To:

From:

Subject:
 110
APPLYING FOR A JOB

The two most common documents that candidates who apply for jobs need to produce are
letters of application and CVs.

LETTER OF APPLICATION

PURPOSE
The purpose of a letter of application is to apply for the position that has been advertised. This
letter should highlight the specific qualifications, accomplishments, and abilities or work
experience that have special relevance for the position you are applying for. The job
advertisement will always tell you how to apply.

I Read the following job advertisement and a candidate’s letter of application.

Asian Productivity Organization (APO)

PROGRAM OFFICER

The Asian Productivity Organization (APO), a regional intergovernmental

organization with its Secretariat in Tokyo, is seeking a dynamic,
competent Program Officer with substantial work experience in the
industry and service sectors. The main responsibilities are to plan,
manage and implement projects to enhance the productivity and
competitiveness of corporations and organizations through the
applications of productivity tools and techniques and to undertake
postproject evaluation, reports, and other necessary follow-up.

Interested candidates must be a graduate from a reputable college or

university, preferably with a Master’s degree in economics, business
administration, or engineering. They should have at least eight years of
working experience in management, corporate planning, economic
analysis, or technological development, with at least three years of staff
management experience. Candidates must have sound knowledge of
productivity improvement tools, techniques and methodologies and
socioeconomic development issues in Asia and the Pacific. Proficiency in
both spoken and written English is essential.

Candidates must be from APO member countries and in excellent health.

Salary will be commensurate with qualifications and experience.
Appointment will be on a fixed-term basis for two years and renewable
on the condition of satisfactory performance and upon mutual consent.

Interested candidates should send a resume with photograph, reason for

application, and job history by 16 September 2008 to:

The Secretary-General, Asian Productivity Organization

1-2-10 Hirakawa-cho, Chiyoda-ku, Tokyo 102-0093, JAPAN
e-Mail: [email protected]

Source: The Economist, September 2008

 Off the Arabian Gulf St. 111
Opp. Al Maqsab Gate
Safat P.O. Box 193
The Secretary-General OPENING
Asian Productivity Organization  Say why you are
1-2-10 Hirakawa-cho, Chiyoda-ku writing
Tokyo 102-0093  Refer to the job ad
Japan  Name the position
for which you are
applying
3 September 2008
Dear Sir or Madam

Job application
MAIN MESSAGE
I saw your advertisement in The Economist of 25 August 2008
 Explain why you are
for the position of Program Officer.
interested in the
position.
I believe my professional training and career objectives meet
your requirements. I hold a Bachelor of Science degree in  Give relevant
Economics from Bocconi University, and the Master of personal
Business Administration degree from Harvard School of information
Business. As you can see from my enclosed CV, I have (education, work
considerable work experience in project management and experience,
economic analysis. This has helped me develop an excellent interests, etc.)
understanding of socioeconomic development issues in Asia  Explain why you are
where I have spent most of my working life. I also believe that suitable for the job.
my expertise in productivity improvement tools might be of
great interest to you.

I appreciate your time in reviewing my enclosed CV and I

would welcome the opportunity to meet and discuss my
CLOSING
qualifications and experience with you. I am available for an
interview at your convenience.
 Conclude the letter
by saying that you
Yours faithfully
are available for an
interview.
John Saunders
John Saunders
Encl: CV
 CURRICULUM VITAE/RESUME 112

PURPOSE
A CV/resumé is a summary of a person’s business or professional qualifications,
educational background, and work experience for a particular position. Its purpose is to give an
overview of the applicant’s capabilities, qualifications, and credentials for a given job.

In a chronological CV, which is the most common and the most readily accepted format,
information about education and professional experience is arranged in reverse order
beginning with your present or most recent position. There are many ways how to write a CV.

I Read this CV and compare it with the job advertisement on p. 110. Is John a good
candidate for the position?

JOHN SAUNDERS
PERSONAL DETAILS

Phone: +965 241 5400 99 /244 7755

Address: Off the Arabian Gulf St., Opp. Al Maqsab Gate
Safat P.O. Box 193
E-mail: [email protected]

EDUCATION

1996-1998 Harvard Business School

Master’s degree in Business Administration (MBA)
1992 – 1995 Bocconi University, Italy
Bachelor’s degree in Economics (BSc)

WORK EXPERIENCE

2004 – present Project Supervision Manager, Development Agency, Kuwait

Responsible for project evaluation and economic analysis
2000 – 2003 HR Manager, Business Innovation Center Singapore
Responsible for establishing recruitment procedures
1999-2000 Training Officer, IBM, Tokyo
Collecting information on training needs and organizing workshops

SKILLS
Computer skills: MS Office 2008
Languages: English (C1), Italian (B2), Arabic (B1)
Additional: Driving license (personal car)

HOBBIES AND INTERESTS

Violin playing, reading (fiction), sports (football, cycling)

REFERENCES

Mr Hashil Samar Professor Lina Tontodoni

Director of the Development Agency Kuwait Bocconi University
E-mail: [email protected] E-mail: [email protected]
Phone:+965 241 5300-31 Phone:+456 241 5300-21
 PRACTICE 113

I Name the headings and categories commonly used in CVs in which you list:
a details about your working life _____________________________
b schools and colleges attended _____________________________
c practical abilities _____________________________
d family name _____________________________
e what you do in your free time _____________________________
f basic facts about yourself _____________________________
g people who can give information about your qualities and character __________________
h when you were born _____________________________
I proof that you have successfully completed a course _____________________________
j where you live _____________________________

II Find a job ad for a position you would be interested in. Then write a letter of
application and a CV for that position.

III Fill in the gaps in the letter with the words from the boxes.
gaps 1-11
position candidate interest background advertised
current objectives responsibilities staff experience enclosed
gaps 12-22
available reviewed hearing leading
sincerely working tasks finding skills meet contact

Dear Mr. Burgin

I am writing to you to express my (1) ___________ in the Office Manager (2) ___________
currently available at Torino Constructions, Inc, which I found (3) ___________ in The
Guardian on 25 January 2013.
I believe that I am an excellent (4) ___________ for this position, given my extensive (5)
___________ in office management and my educational (6) ___________ in Business
Administration.
As you will see from my (7) ___________ CV, I have spent the last five years working as an
office manager for a small, but vigorously growing company. In my (8) ___________ position I
support an office of 20 people, where my (9) ___________ include managing (10)
___________ setting clear (11) ___________ and making sure that our team completes (12)
___________ by a deadline. I have a flair for (13) ___________ people, (14) ___________
quick solutions to problems and (15) ___________ with clients of various backgrounds. At this
point in my career I wish to find a more challenging position with a much larger company and
hope to transfer the communication, interpersonal, and motivational (16) ___________ that I
gained in my current management post to my new position.
I feel that after you have (17) ___________ my CV you will see that my excellent skill set and
enthusiasm (18) ___________ your requirements perfectly.
I am (19) ___________ for an interview at a time convenient to you. In the meantime please
feel free to (20) ___________ me if you have any questions or require further documentation.
Looking forward to (21) ___________ from you in the near future.
Yours (22) ___________

Harold Wagner
Harold Wagner
 TYPES OF LETTERS 114

We will learn about four types of letters in the rest of the unit.
o Letter of enquiry/inquiry
o A response to a letter of inquiry
o Letter of complaint
o Letter of apology

THE STRUCTURE OF LETTERS

Most business letters can be divided into three parts:

Dear….
1 OPENING: to say why you are writing
2 MAIN MESSAGE / BODY: the details
3 CLOSING: signals the end of the letter, indicates future contact
Yours …

The greeting line and the how you sign off are interconnected:
Dear Sir or Madam
Yours faithfully

Dear Mr/Ms/Miss/Mrs Smith

Yours sincerely

Dear John
Best wishes

FUNCTIONS
The following functions will be used in the types of letters in this unit:

1 Starting a letter
2 Ending a letter
3 Asking polite questions/ making enquiries
4 Announcing something (Giving good / bad news)
5 Asking someone to do something (Requesting some action)
6 Giving a warning
7 Apologising
8 Giving a reason for something

Starting a letter
I Complete these sentences with the help of the Useful Phrases section (pp.123-124).
1 We are writing to _____________________________________
2 We are writing in ___________________________________________
3 Thank you ___________________________________________
4 With _______________ to our telephone conversation yesterday
5 __________ to our meeting last week…

Ending a letter

I Complete these sentences with the help of the Useful Phrases section (pp.123-124).
1 We look forward to __________________________________________
2 Please contact me if __________________________________________
3 Please do not hesitate to contact me if _________________________________________
4 Please let me know if _________________________________________
5 I hope that this information ________________________________________
 LETTER OF ENQUIRY 115

I Read this letter of enquiry and see how it is structured.

1 Greeting line Dear Sir or Madam

Rafting on the Dobra

2 Subject line

I am writing to enquire about a rafting trip that was

3 Say why you are advertised in the magazine Extreme Sports on 14 July
writing.* 2012.

Could you please tell me on what dates you offer the trip
4 Body: Ask your and at what prices? I would also like to know if I can book
question.
accommodation through your agency.

I would appreciate a reply at your earliest convenience.

5 Closing remark
Yours faithfully
6 Sign off
Beth Simmons
Beth Simmons

7 Signature and
name

* If you mention a newspaper or a magazine, you should always include the date when you saw the advertisement or other
information.

II Which of the functions listed on p. 114 can you find in a letter of enquiry?
_________________________________________________________________________

Asking polite questions / Making an enquiry

Making questions more sound more polite: Indirect / embedded questions

Here are some phrases that you can use to introduce an indirect question:
1. We/I would like to know (if)…
2. I was wondering (if)…
3. I am interested in finding out (if) …
4. Could you please let me know (if)
5. Could you (possibly) tell us (if) …
6. I would be grateful if you could tell me (if) …

I Turn these direct questions into indirect ones.

1 When will you send us the payment?

___________________________________________________________________________
2 Did you send the attachment?
___________________________________________________________________________
3 How much is a room for two in your hotel?
___________________________________________________________________________
4 Can you replace my faulty computer or give me a full refund?
___________________________________________________________________________
 III Use the prompts below to write a letter of enquiry. Invent all necessary details. 116

You are interested in a trip to the North of Italy. You want to ask the following questions:
 Are there any trips in July?
 Can the organizers give a discount to your group of 10 people?

___________________ (date)
Dear _________________

_____________________ (subject)

I am writing to enquire about ____________________________________________.

Could you please _____________________________________________________?
I would also like to know if _______________________________________________ .

I look ____________________________________________________________.

Yours ______________________

________________________ (signature)
________________________ (name)
________________________ (title)

I Write a letter of enquiry. Use block style.

Write a letter of inquiry to Ms Linda Bertich at Oxford University Press inquiring about an e-
learning package for Business English. Ask if they offer any discounts for university students.
 A REPLY TO A LETTER OF ENQUIRY 117

I Read the letter and see how it is structured.

1 Greeting line Dear Ms Ryan

Gibson guitar out of stock

2 Subject line

With reference to our phone conversation yesterday (13

3 Say why you are January 2013) concerning your interest in ordering a
writing.* Gibson Les Paul ’59, we would respond as follows.

We regret to inform you that this type of guitar is currently

4 Body: Give news/ out of stock. However, we do have a Les Paul ’62 model or
information
a Gibson SG in stock, which you might find equally
suitable.

Please find enclosed our most recent catalogue and price

5 Closing remark list.

Yours sincerely
6 Signing off Peter Davids
Peter Davids

7 Signature and
name

* If you are referring to a previous contact with the recipient of the letter always provide the date.

II Which of the functions listed on p. 114 can you find in a reply to a letter of enquiry?
_________________________________________________________________________

Giving news

Look at the following examples of how you can introduce good or bad news:
Good news Bad news
• We are pleased/glad/happy to announce that  We regret/are sorry to inform/tell you
... that ...
• I am delighted to inform/tell you that …  I'm afraid it would not be possible to ...
• You will be pleased to learn that ...  Unfortunately we cannot / we are
unable to ...
 We are able to …  After careful consideration we have
decided (not) to …

III Use the above prompts to give good or bad news in the following situations.

1 An increase in the interest rates on deposits (in a letter from a bank).

___________________________________________________________________________
2 The recipient of the letter has been shortlisted to attend a job interview.
___________________________________________________________________________
3 The recipient’s job application was rejected.
___________________________________________________________________________
4 Your shop sells the type of tablet that the recipient enquired about.
___________________________________________________________________________
5 The meeting is cancelled. 118
___________________________________________________________________________
6 The meeting is postponed for a week.
___________________________________________________________________________

IV The sentences of the following letter are jumbled up. Put them in order.

a) Dear Mr Horvat
b) I am happy to tell you that we are able to offer a 10% discount for groups of 6 and up.
c) I am writing in response to your email of 15 January enquiring about our trips to the North of Italy.
d) I hope that this information is helpful.
e) I look forward to seeing you on one of our trips.
f) Petar Ivić
g) We organize trips both in July and August. Our July group leaves Zagreb on 7 July and returns on
14 July.
h) Yours sincerely
i) Trip to Italy

V Write out the letter. Invent all necessary details.

 119
LETTER OF COMPLAINT

PURPOSE
Letters of complaint are sent when customers or business partners are not satisfied with
the quality of service or product they have purchased or agreed on. Complaints can be
mild or strong, depending on the situation. Here are two letters of complaint. Underline
words/expressions that indicate a mild or a strong complaint.
Dear Mr Ivić

Faulty Whirlwind 342 washing machine

 say why you
I am writing to complain about the washing machine I bought from are writing
your website.

Unfortunately, the product you delivered is well below the standard I

expected. The problem is that the machine does not take enough
water and the laundry comes out stained. When I called your  explain the
company, your staff was not willing provide information on how to get reasons for
the machine repaired or replaced. complaining

I would appreciate it if you could replace the faulty machine as soon

as possible.
 ask for
Looking forward to hearing from you soon.
immediate
action
Yours sincerely
Marija Horvat

Dear Mr Ivić
 say why you
Faulty Whirlwind 342 washing machine
are writing
It has now been two weeks since I first complained about the washing
machine I purchased from you and I still have not received any reply.
 point out what is
I would like to point out once again that the washing machine is
wrong
faulty and I am unable to use it.
 give further
I hope it is not necessary to remind you that under Whirlwind’s guarantee and
reasons in
liability terms you are obliged to replace all faulty machines within a week.
support of your
Unless I hear from you within seven days, I will be forced to take legal action complaint
against your company.

Yours sincerely  give a

Marija Horvat warning

I Which of the functions listed on p. 114 can you find in the two types of complaints?
_________________________________________________________________________
_________________________________________________________________________

II Write a letter of complaint. Use block style.

You work for Horvat &Horvat d.o.o. (Petrinjska 18, Zagreb). You have just phoned your
bank. They have informed you that Promet d.o.o. has not yet paid their debt. Write to
Promet d.o.o. (Sisacka 54, Karlovac), and tell them what you have learnt. Make a point
(you agreed that payment was to be made by 15 October, and now it is 10
November). Demand payment within a week. Make a strong complaint.
III Which verb tense should we use when talking about past events? 120

IV Fill in the gaps with the correct form of the words in the box.

hear, return, complain, notice, estimate, appreciate

Dear Sir or Madam

HP Mini 1140 laptop

I am writing to _______________ about the new HP Mini 1140 laptop that I purchased in the HP
Brand Store on Main Street on 20 February 2013.
When using the laptop for the first time, I _____________ that the screen flickers and turns off after
about an hour of use. When I ______________ to the store to ask for a replacement or a refund, I
was told that they cannot offer me either, but that the faulty machine can be sent away for repair.
They ____________ that this would take about a week.
Since I travel extensively and use my laptop daily, this option is not viable for me. I would therefore
_____________ it if you could arrange a quicker repair or a full refund.
I look forward to ____________ from you within the next week.

Yours faithfully

Joe Comptor
Joe Comptor

V Rewrite this letter of complaint to make it sound more polite. Make sure that only
relevant information remains in your letter. Also provide the address of the sender and of the
recipient.

Mr Jones!

You didn’t deliver my filing cabinets on time. I already paid for these goods 6 months ago. I need
these filing cabinets because I moved into a new office and I have nowhere to put my important
documents. Without these cabinets my room is really messy. 
I want you to send the filing cabinets in 2 days. If you don’t deliver them within a week, I will file a
formal complaint against your company with the consumer protection agency!!!

Goodbye, Peter Allen

 121
LETTER OF APOLOGY

I Read the letter and see how it is structured.

1 Greeting line Dear Ms Holland

Delay in delivery of order 786

2 Subject line

3 Say why you are I am writing to apologize for the delay in sending your order
writing.* of 5 Meridian filing cabinets.
(1st apology)
Unfortunately, we are unable to deliver the cabinets on time
due to an upgrade in our computer database which
4 a) Body: explain
monitors stock levels in our warehouse. We are going to
what happened and
what you are doing resume deliveries on Tuesday (20 March). You should
to correct the receive your order with a delay of three days.
mistake.
To compensate for this inconvenience, we would like to
4 b) Body: Offer offer you free delivery on your order.
compensation.
(optional) Please accept our apologies once again.

If you require more information, do not hesitate to contact

5 Closing remarks
me.
(2nd apology)

Yours sincerely
6 Signing off Anne Lambert
Anne Lambert
7 Signature and
name
* If this is a response to a letter of complaint, always provide the date when that letter was written.
II Which of the functions listed on p. 114 can you find in a letter of apology?
_________________________________________________________________________

_________________________________________________________________________

Giving a reason

This is (as) a result of + Noun This is (as) a result of the fact that + Verb phrase
This is owing to* + Noun This is owing to* the fact that + Verb phrase
This is due to + Noun This is due to the fact that + Verb phrase
This is because of + Noun This is because of the fact that + Verb phrase
* use only for bad news
III Finish the above prompts with the following phrases.

1 …a delay in delivery
_________________________________________________________________________
2 … a strike by airline pilots
_________________________________________________________________________

3 … we lost your documentation

_________________________________________________________________________
4 … an accident happened at the plant
_________________________________________________________________________
 122
IV Look at how you can introduce some news and give a reason for it. Check back to the
replies to letters of enquiry for more details on how to give good or bad news.

The news: the meeting is cancelled.

The reason: the weather makes it impossible to drive.
Unfortunately, I am forced to cancel the meeting. This is as a result of weather conditions which
make it impossible to drive.

1 Increase in the price of wool – decrease in production

_________________________________________________________________________
_________________________________________________________________________
2 Additional documentation is required for registering a company – the government changed the
related regulations
_________________________________________________________________________
_________________________________________________________________________
3 Increased number of TV channels available – a customer’s reward for 5 years of loyalty to the
provider (sent by the service provider TTTV)
_________________________________________________________________________
_________________________________________________________________________
4 The company will not pay dividends this year – the company made no profit
_________________________________________________________________________
_________________________________________________________________________

V Fill in the gaps with the correct form of the words in the box.
compensate, connection , sorry, inform, apologies, inconvenience, replace,
continue

Dear Ms Horvat

I am writing in ____________ with your recent complaint.

I am ______________ for the ______________ we have caused you. I have spoken to the staff
involved and I can assure you that your problem will be resolved immediately.
To ________________ you for the inconvenience, we would like to offer you another washing
machine to _____________ the faulty one. We will ______________ you next week about the
exact time of the delivery.
I very much hope you will ______________ to use our products in the future.
Please accept our _____________ once again.
Yours sincerely
Marko Ivić
Marko Ivić
Sales Manager

VI Write a letter of apology. Use block style.

Write to NaPa Import-Export d.d. (Baruna Trenka 45, Osijek) and tell them that you
cannot deliver their order on time due to an accident in the plant. You expect your
operations to be back to normal by the end of this month. They will receive the goods
within two weeks.
 123

BUSINESS LETTERS: USEFUL PHRASES

I Study the phrases below and do the exercise which follows.

OPENING AND Dear Sir or Madam - Yours faithfully

CLOSING
Dear Mr Brown/Dear Ms White - Yours sincerely
Dear Michael - Best wishes /Best regards
BEGINNING We are writing to inform…/confirm…/request…/enquire about…/
A LETTER
complain about…/apologise for…
I recently read/heard about…and would like to know…
We are interested in…and would like to know…
We are writing in connection with….
REFERRING TO Thank you for your letter of 15 May asking if…/enquiring about…
PREVIOUS CONTACT
Many thanks for your message, dated 6 June.
Thank you for your enquiry
Thank you for your email.
Thank you for your email, dated 15 May.
We have received your letter of 15 May enclosing…/
concerning…/regarding…
With reference to our telephone conversation yesterday….
Further to our meeting last week…
With regard to…
REQUESTING ACTION/ Could you please send me…as soon as possible/immediately/
REQUESTING without delay.
INFORMATION We would be grateful if you could let us know (about/if)…
I am interested in obtaining/receiving…
We would appreciate it if you could give us some further details
about…
We would like to know (about/if)…
Please can you tell me…
Please could you send me (details of)…
GIVING GOOD NEWS
We are pleased to inform/tell/advise you that…
I am glad/happy/delighted/pleased to announce…
You will be pleased to learn/hear…
We are able to…
GIVING BAD NEWS
We regret to inform you that…
We are sorry to tell you that…
Unfortunately we are not able to…/unable to…
We have been forced to…
MAKING
I am writing to complain about…
A MILD COMPLAINT
I am writing to express my dissatisfaction with…
Unfortunately, we have not yet received…
Please could you…/We would be grateful if you could…/We would
appreciate it if you could…
MAKING 124
The things that annoyed me most.../What made me
A STRONG
COMPLAINT particularly dissatisfied/angry...
I should like to point out that…/I should like to draw your
attention to the fact that…
I hope it is not necessary to remind you that…
We must insist, therefore, that you take immediate action.
If you are unable to do this, we will be forced to cancel your
contract with us.
Unless we hear from you within a week, we will be forced to take
legal action.
APOLOGISING We are sorry for the delay in replying…
I would like to apologise for the
delay/inconvenience… We must apologise for…
We are extremely sorry for…
We hope this has not caused you any inconvenience.
Please accept our apologies once again.
With apologies once again.
GIVING REASONS This is due to…/owing to…
This is because of…/as a result of…
ATTACHMENTS AND I attach some information which I hope you find useful. I have
ENCLOSURES
pleasure in attaching…
I am attaching our catalogue to this message. I am attaching
details of…
If you have any problems opening this file, please let me know.
I attach our price list and look forward to hearing from you.
Please find attached our report.
I am enclosing my CV. /I enclose my CV. Please find my CV
enclosed.
PROBLEMS WITH I am afraid you forgot to attach the report. Could you send
ATTACHMENTS
your message again, please?
Unfortunately, the attachment won’t open on my
computer. Could you send it again in a different format?
Sorry! I forgot to send the attachment.
ENDING A LETTER We look forward to receiving your reply.
I am looking forward to hearing from you.
We look forward to doing business with you in the future.
Please contact me if you need any further information.
Please do not hesitate to contact me if you have any further
questions.
Please let me know if you need any further information.
I hope that this information will help you.
 125
REVISION 5
I Identify the parts of the business letter and fill in the empty boxes.

Beewiz Co.
13 King Street
Manchester
M35
England
Tripfinder Co.
4 Hawk Road
Manchester
M35
England Our ref:
JG/st/4

5 June 2010

Dear Sir or Madam

BUSINESS LETTER LAYOUT
Trip to Split

We are writing in connection with the above

trip.

We would like to inform you that the number of

people interested in the trip has changed.
There are now 22 persons on the list.

We hope that this has not caused you

any inconvenience.

Yours faithfully

John Gooding
John Gooding
HR Manager
 126
II Fill in the missing words.

 The name and the address of the addressee (the person you are writing to) are at the top on
the .
 The date is on the .
 The paragraphs are at the . Between each paragraph there is a
.
 Under the _, there is the name and title of the writer.

III Circle True or False.

 You can use a comma in the address or after 'Dear...' or after 'Yours faithfully/sincerely'
TRUE/FALSE
 You have to write th, rd, nd or st after the day.
TRUE/FALSE

IV How do you OPEN these letters? Fill in the missing words.

Dear to a company
Dear to a man if you do not know his name
Dear to a woman if you do not know her name
Dear to a married or unmarried woman
Dear to man
Dear to a married woman
Dear to an unmarried woman
Dear to a friend or someone you know well

V How do you CLOSE these letters? Fill in the missing words.

Dear Sir or Madam – Yours

Dear Mr/Ms/Mrs/Miss Smith – Yours

Dear John – Best

VI Fill in the missing words.

 Subject draws attention to what the letter is about, so when we put a
heading we then use the word above e.g. if the heading is Invoice No...., we say: I am writing
about the invoice...
 The body of most letters has three parts: AN OPENING, which says
, THE MAIN MESSAGE, which gives the
, and THE CLOSING, which usually refers to
contact. Each part is usually a separate
_, but the main message can be more than one paragraph if you are
writing about more than one .
VII Here are some ways to BEGIN A LETTER. Circle the correct answer. 127

 We are writing to enquire for / about …

 We are writing in / with connection to / with …
 We are interested about / in ... and we would like to / Ø know...

VIII Here are some ways in which you can write A REPLY TO A LETTER. Fill in the
missing words.

 you for your letter of (date) … if …

 We have your letter of (date) … about…
enclosing …
concerning … regarding …

IX Here are some ways to END A LETTER. Fill in the missing words.
 I look to receiving your reply/order/products/etc.
 Looking forward to from you.

X If you GAVE SOME INFORMATION in the letter, you can END THE LETTER by
using the following phrases. Fill in the missing words in the phrases.

 I that this information will help you.

 Please me if you need any further information.
 Please do not to contact me if you have any questions.
 Please me know if you need any further information.

XI Put the following steps in writing a letter in the right order:

Produce a final version. ☐

Make changes and corrections. ☐
Write a draft. ☐
Send a letter. ☐
Read carefully the letter you have received. ☐ Check
spelling, grammar, style and layout. ☐ Make a plan for
the letter. ☐
Read the letter again. ☐
Note down important/useful phrases. ☐
 128
XII Use the phrases from the previous section to write the most appropriate
sentences in the following situations.

1. You saw an advertisement about a trip to Vienna on the Internet and you want further
information. How would you start this email to a travel agency?

2. You want to know if the language centre in London offers scholarships for university
students. How would you request information in this situation?

3. You want to know the prices of the television sets from the catalogue you have seen on the
Internet. How would you request information in this situation?

4. A company wrote to you on 15 May. They wanted to know about the warranty period for your
computers. How would you start your reply in this situation?

5. You have received an email with an important attachment missing. How would you
request action in this situation?

6. You are going to an important conference in Paris next week. You have just realized that your
passport has expired. You want to have it extended urgently. How would you request action in this
situation?

7. Use different phrases to refer to the following situations:

a) a meeting you had with Mr Carter last week

b) an invoice No. 546 for a washing machine

c) the results of your final exam

8. Use different phrases to give good news concerning the following situations:

a) a candidate’s application for a post as project manager

b) a discount of 10% if the goods are purchased in cash

c) a bank loan granted for apartment adaptation

9. Use different phrases to give bad news concerning the following situations: 129

a) a candidate’s application for a post as project manager

b) a discount of 10% if the goods are purchased in cash

c) a bank loan requested for apartment adaptation

10. Use different phrases to give reasons for the following situations:
a) delayed flights – strike by flight attendants

b) no Christmas bonus – decreased profits

c) increase salaries – reduced income tax

11. You were dissatisfied with the quality of hotel accommodation. How would you make a mild
complaint?

12. The laptop you have bought recently has broken down the second time in the past six
months. You want a new laptop or your money refunded. How would you make a strong
complaint?

13. You were supposed to send a reply to an email you had received a week ago. How would you
apologise in this situation? Give your reasons as well.

14. A lot of customers have already complained about the unprofessional behaviour of the shop
assistants in one of your shops in the centre of Munich. How would you apologise in this
situation? Offer some compensation as well.

15. How would you end a letter in which you have given some information?

16. How would you end a letter in which you have tried to deal with a client’s complaint?

__________________________________________________________________________
 XIII There are some mistakes in this letter. Can you find the mistakes and correct 130
them? Pay attention to accuracy (grammar, spelling and punctuation) as well as the
layout. Then, write out the letter correctly, in 'block style'.

168 Willow Street Ms Hilary Hendricks,

London W1J 9LE 463 Park Avenue

Tel 020-7459 9835 New York, NY 10022

Fax 020-7459 7836 USA.

Your ref Book order 3456

Our ref TF/mg

Email: [email protected]

www.willow.bookshop.co.uk

Dear Sir,

I’m writting to complain about the above order witch I placed with yours bookshop.
It was now over six weeks since I ordered the books and I still don’t receive them. I want to
remind you that I have alredy paid these books that I need for my thesis and couldn’t find in
New York bookstores. I must insist therefore that you deliver them imediatelly or give me
back my money.
Unless I don’t hear from you within the next few days, I will be forced to take legal
action.

2010, june 21st

Best wishes,

Hilary Hendricks

Hilary Hendricks

XIV Finally, write a reply to this letter apologising for this situation, giving reasons
for the misplaced order and offering some kind of compensation.

Sources consulted:
Littlejohn, A (2006). Company to Company. Fourth Edition. CUP
University Press
Kiss Kulenović, B., Lekaj Lubina, B. Linčir-Lumezi, M., Planinšek-Čikara, I. (2015) English for Business. Zagreb: University
of Zagreb, Faculty of Economics and Business
 131
13 GROUP PROJECT

Before starting a business you should have a good idea that you can be developed into
something that others will want to use and pay for. Most of the time, this requires an initial
financial investment, but not always.

Imagine, that it is summer. It is really hot outside and

you would love to go for a swim, but you don’t have a
pool. You neighbour does. How could you turn this
situation into a successful business idea?

I Read the text and see how Bunim Laskin, an American college student invented a new
business.

Imagine a last-gasp heat wave. You want to cool off. Hmm, let’s see. How about going for a swim in a
random stranger’s back-yard pool—but without getting arrested or shot at or developing a weird skin
disease? Sound enticing? If so, there’s now an app for that, a sort of Airbnb for pools. It’s called
Swimply. The name might strike you as awkward—maybe appropriately so, given the potential ick
factor of diving into waters that could be half toddler urine—but “it captures what we do,” Bunim
Laskin, the company’s twenty-two-year-old C.E.O., said. “It’s swimming. It’s simple.” The name was
originally even simpler: Swimple.“But people said it sounded like ‘pimple,’ so we added the ‘y.’ ”
...
“The first day, I made a thousand dollars in bookings,” Weinberger, Swimply’s chief marketing officer
and Laskin’s business partner said. He now claims to host paying strangers in his pool four times a
week, on average. Over all, the company has signed up pools in thirty-six states in a little more than
a year. Hosts set their own prices; Swimply takes a commission, plus a “service charge” from
swimmers. As for the ick factor? The company partners with local pool-maintenance firms to make
sure that pools are up to snuff and proper pH levels before they’re listed.
...
Laskin, launched Swimply ... while he was home from college. His family had been paying a
neighbor to use the pool she had built for her mostly absent grandchildren and he realized that he
might have found a scalable business.
“I went on Google Earth and searched eighty pools nearby,” Laskin recalled. “I knocked on eighty
doors. I got seventy-six slammed doors. And we started with our first four pools.” He added, “They all
had to be within walking distance, because I didn’t have a car.” Initially he built “a really dumbed-
down Web site” and launched it under the name Pool For U. At that stage, the site was just a listing
service: a potential swimmer would call Laskin about a pool; he would then call the host, make
arrangements, and get back to the swimmer. For promotion, he placed an ad in a local paper. Within
two weeks, he said, “the four pools became thirty-two. And two weeks later MSNBC mentioned us,
and the Web site crashed. That was the end of my summer and the beginning of Swimply.” 132
By December, Laskin had dropped out of college to pursue the concept full time. Weinberger helped
him raise funding to build a proper Web site and app. To their surprise, among the early adopters
were observant Muslim and Jewish families, who are often reluctant to swim in public. “There are all
kinds of niche communities,” Weinberger said. “We’ve had people with body issues—amputees,
things like that—where they’re uncomfortable going to a public pool. Nudists find this to be a great
way to express themselves. “We had a mermaid thing that I just didn’t get,” Laskin said. Weinberger
thought it might have been a meet-up for a group “that identifies as half human, half fish,” which he’d
read about in a magazine.
...
Adapted from: Handy, B. "The Sharing Economy: At Last, an Airbnb for Pools" The New Yorker. Sept. 9, 2019. Online:
https://www.newyorker.com/magazine/2019/09/09/at-last-an-airbnb-for-pools

II What can you learn from the story of Swimply? Answer these questions and draw
conclusions.
1) Why did the founders choose “Swimply” as the name of the start-up?

2) What was the original business model (when the business was called Pool For U)?

3) What was the original marketing mix when Swimply was launched?
a. Product
b. Price
c. Place
d. Promotion

4) What is Swimply’s target market?

5) Why is it important (from the marketing point of view) that “the company partners with local
pool-maintenance firms to make sure that pools are up to snuff and proper pH levels before
they’re listed”?

6) What is Swimply’s current marketing mix?

a. Product
b. Price
c. Place
d. Promotion

7) Is Swimply a completely new idea or is it an example for using an existing idea in a new way?
Explain.

III Conclusions:

1) Do you always need a completely new idea to start an innovative business?

2) Do you always need a large initial investment for a start-up?

3) If you don’t have capital, what can you do instead to start a business?

4) Can you run a successful business only relying on niche markets (people whose needs are
not catered for, who are often forgotten about by bigger firms)?

5) Will your marketing mix change as your business develops?

6) How should you choose the name of your business? What should it reflect?
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YOUR BUSINESS PLAN

Work individually or in groups to prepare this business plan for your imaginary start-up.
Fill in each section as we cover the corresponding unit. Fill in the first section after the
Entrepreneurship unit. Make sure that you use business English terms where possible.

SECTION 1
1) Team members: List all team members here. Make sure you have each other’s contact
information (phone number, e-mail address, etc.)

2) What kind of business will you open? Incorporated or unincorporated? Explain why.

3) What kind of business organization will you choose? Why?

4) Which business sector / industry is your firm part of?

5) How much capital will you need for your business?

6) How will you raise this capital? List the institutions or individuals you will contact and how
much you will raise from each of them.

SECTION 2: Fill in after revising the Company structure unit

1) What kind of structure will your business have? Explain why.

2) Will this structure change as your business matures? Why/ Why not?
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SECTION 3: Fill in after revising the Labour relations unit
1) What will your employees’ economic package contain?

2) What will the work rules be?

SECTION 4: Fill in after revising the Recruitment unit

1) Management team: What is the background of your team members? What will each
member contribute to the business?

2) What kind of expertise do you lack? What kinds of skills do you need in your future employees?

SECTION 5: Fill in after revising the Marketing unit

1) Product or service: What will you make or what service will you offer? Describe your
product or service briefly. Try to be specific, don't just say “we will be making chocolate.”

2) What is innovative about your product/service?

3) Is this a completely new idea or are you using an existing idea in a new way? Explain.
4) Competitive advantage: What is your product’s/service’s added value or unique selling 135
point?

5) Customer profile: What is your target market? Why would these people want your
product/service?

6) Competition: Describe the existing competitor(s) to your product or service.

7) Implementation plan: Describe the marketing mix that you will use for your product or
service.