Topic english.

Topic 1> what fields does economics focus on?

Economics focuses on the way people need and want made brought to them.

It also studies the way people and nations choose the things they actually buy from among the many things they want, because people as nations always want more than they can afford to buy, that means their wishes are unlimited, but money and some different resource are limited. So they must choose and try to use the resources they have to produce the things they most want.

According to the economists, economics focuses on the way to produce and distribute goods and services.everything can be bought and sold. production mean processing and making of goods and services, distribution means the way to device goods and service among the people.

Topic 2> why it is said that economics is a study of mankind?

It is said that: economics is a study of mankind, because it tell us how man subsists, grows, and develops in relation to the wealth available on earth.

In all countries .the resources used to produce goods and services and money are scarce, so they use limited resources in the least economical to invest in modern technology, factories, businesses. but investing in education is the most profitable way, people with their economic knowledge will expand and develop the economy strongly.

Beside, goods and services are produced for the life of people. Economists define economics as the study of how goods and services get produced and how they are distributed. People process, make products and divide them among themselves, so they connect with people closely, everybody must have a suitable behaviour with them ,so economics is a study of mankind.

3>what is microeconomics?

Microecononomics is the study of individual behaviours in the country, the study of the components of the large economy. It analysis offers a detailed treatment of individual decisions about particular commodities.

In microeconomics, we focus on the individual ,businesses, households.. and their behaviours but ignore interactions with the rest of the economy. For example, we might study spending decision of households and production decision of business, firm, then aggregate the behaviour of all households, firm,...to discuss about supply and demand in the economy.

It is used to help businesses , household ..in the economy make suitable economic decisions. Businesses can maximize their profits. Household can maximize their advantages.

4>what is macroeconomics?

Macroeconomics is the study of aggregate economic behaviour, it is the study of the economy as a whole.

In macroeconomics we focus on the national goals. it looks at overall economic trends such as :unemployment levels, economic growth ,balance of payments. and inflation. Macroeconomics is controlled by fiscal and monetary policy. Fiscal policy is issued by government, it involves government's budget, borrowing, spending plans...and it is used to control the whole economy. Monetary policy is issued by central bank, it involves money supply, inflation, exchange rate...and central bank use it to promote economic growth and keep inflation under control.

It is used to help government make suitable economic decisions to guarantee macroeconomical aims of country.

5) the different between microeconomics and macroeconomics?

-microeconomics is the study of individual behaviours in the economy, the study of the components of the large economy.

-macroeconomics is the study of aggregate economic behaviours , it is the study of the economy as a whole.

- the differences:

Microeconomics is the study of the components of the economy, macroeconomics is the study of the economy as a whole.

Microeconomic focus on the behaviour of businesses , households,.. macroeconomics focuses on the aims of a country, it looks at overall economic trends : employment levels, economic growth, balance of payment, inflation.

+Microeconomic tends to offer a detailed treatment of one aspect economic behaviour but ignore the interactions with the rest of the economy, macroeconomics emphasizes the interactions in the economy as a whole.

+ Microeconomics help businesses and households make suitable economic decisions, macroeconomic helps government guarantee national aims.

6).the different between planned economy and the market economy.

-a market economy is an economic system in which the market is regulated by the law of supply and demand.

-a planned economy is an economic system where the structure of the market is deliberately planned by the state.

-the differences:

+ market economy id regulated by the law of supply and demand , but planned economy is deliberately planned by the state ,all the economic quotas are fixed beforehand.

+in market economy ,all business firms are supposed to compete freely , but in planned economy, there is no real competition between industrial or commercial organizations.

+there is no direct government intervention in market economy, but in planned economy government influence directly the economy situations.

+market economy accept all kinds of ownership, but private ownership does not exist in planned economy.

Topic 7:talk about supply and demand

Demand is the quantity of goods buyers willing and wish to purchase at alternative price in a given time period.

Supply is the quantity of goods sellers willing and wish to sell at alternative price at a given time period.

Demand describes how price influences buys behaviour while supply describes how price influences seller behaviour.

Law of supply and demand.

Demand curve shows the price influence on buyers. when price increase .demand will reduce, demand curve move to the left. and when price decrease ,demand will raise, demand curve move to the right. The change of one of shift factor of demand, such as society 's income, prices of other goods, expectation tastes...make the shift of entire demand curve to the right or to the left.

Supply curve shows the price influence on sellers. when price increase ,supply will raise ,supply curve move to the right, and when price decrease, supply will reduce, supply will move to the left. the change of one of shift factor of supply ,such as changes in prices of inputs, technology, taxes, supplier's expectations.. make the shift of the entire supply curve to the right or left

Topic 8> the role of supply and demand.

Demand is the quantity of goods and services buyer willing and wish to purchase at alternative price in a given time period.

Supply is the quantity of goods and services seller willing and wish to sell at alternative price in a given time period.

The role of supply and demand.

Supply and demand play an important role in regulating market by price.

Because it makes equilbrium price the market, it is the price which make sure that quantity people want to buy is the same the quantity people want to sell.

Supply and demand tell us about the possible price will actually exist in the market in a given time period.

Supply and demand refleet the ability of production, business and consumption when supply increases ,it means the production and business develop and when demand increase ,it means the consumption rises and people are richer.

If there are no supply and demand there will no market and how we can develop production and consumption. it means no economic growth ,so supply and demand play an important role in a modern economy.

9. what's price and its importance in the economy?

From marketing viewpoint, price is the money or other consideration (including other goods and services) exchange for the ownership or use of goods or services.

- the important role of price

+ price is the most important element with decision of buyer choice, company market share and profitable, non - price factors such as : taste, tax ...are also important, but they are only represent cost, while price is the only element in the marketing mix that produces revenue.

+ price helps to indicate the value of goods and services ( as an indicator of value) .the valuable goods will be bought and sold with a high price.

+ price helps to regulate supply and demand, through equilibrium price and suitable price , producers and consumer will have good economic decisions.

10) why do all modern societies use money?

Money is commodity accepted as a medium of economic exchange, it is the medium in which prices and value are expressed.

It is used widely by all societies because:

+it has 4 important functions, money serves as medium of exchange , measure of value , a store of value and a standard of deferred payments. Anything has 4 those functions is considered as money.

+it helps everybody satisfy need and wants about goods and services.

When a person has money , that person will buy goods and services which he or she wants.

+it makes trade become more easier and more convenient , it can be circulate widely between this city and that city, this country and that country, business job will become much more successful.

+ it helps people save time energy ... to perform their work.

11) the differences between commodity money and token money?

-commodity money is a useful good that serves as a medium of exchange. In some cases , commodity money serves as money. For example in prison cigars serves as money. In ancient time people use some commodity money such as shells , beads... to serves as money.

-token money is a means of payment whose value or purchasing power is much greater than cost to produce it. Some kinds of token money are coins, note...

- the differences :

+the value of commodity money is about equal to the value of the material contained in it, while the value of token money is much greater than value of material contained in it.

+ token money is used more widely than commodity money because it can be circulated easily ,and it helps government and central bank control money supply in the economy and reduce inflation. The use of commodity money must depend on the different commodities , so it can bring difficulty for users.

12)what are banks like and their major functions?

Banks are institutions that accept various types of deposits and uses the fund attracted primarily to grant loans.

Functions:

Two main functions of banks are:

-receiving all kinds of deposit.

- making loans

They make profits on difference between deposit interest rate and loan interest rate.

+beside banks also have got other functions : open checking accounts ,saving accounts, mutual saving, credit...

+banks are key financial intermediaries of serve as middlemen in the transfer of funds from savers -who have idle money and can receive in banks to get interest - to borrowers - who need money such as investors, businesses, households , individuals. Investor need money to invest in valuable properties , real assets, security in stock exchange. Businesses need money to expand marker , buy modern technology , improve economic resources (human ,factory ..) households and individuals need money for personal aims.

13) what is an interest rate and its influences on the economy?

-An interest rate is the cost of borrowing , or the return from lending , expressed as an annual percentage.

- it plays an important role in households's decisions to purchase durable goods such as cars and houses ,and in influencing the contruction of new business plants and commercial buildings.

-one of the most important interest rate is real interest rate. It is the interest rate which is adjusted for expected inflation. It is very important because :

+it influences consumption and investment expenditures.

+it has major implications for well being of both borrowers and lenders ,as it influences the way in which real wealth is redistributed among them.

+it also influences the exchange rate in the international market, such as changes in real interest rate help to determine the cost of import.

14) what is fiscal policy and its roles in the economy?

-fiscal policy is a government policy related to taxation and public spending. In a other word, fiscal policy is concerned with revenue through taxation, spending through budget, and borrowing of government

-there are 2kinds of fiscal policy : expansionary fiscal policy and contractionary fiscal policy.

-expansionary fiscal policy :

+It means that taxation is cut or public spending is raised.

+it help to create more jobs, encourage spending and raise demand, increase economic growth.

-contractionary fiscal policy:

+ it means that taxation is raised or public spending is reduced.

+ it helps to restrict demand , slow down the economy and control inflation.

- all kinds of fiscal policy are used in order to control overall economy with macroeconomic aims :

+ high employment level

+high economic growth

+balance of payments

+inflation

15) under what circumstances can fiscal policy be expansionary or contractionary?

-fiscal policy is a government policy related to taxation and public spending. In a other word, fiscal policy is concerned with revenue through taxation, spending through budget, and borrowing of government

-there are 2kinds of fiscal policy : expansionary fiscal policy and contractionary fiscal policy.

-expansionary fiscal policy :

+It means that taxation is cut or public spending is raised.

+it help to create more jobs, encourage spending and raise demand, increase economic growth.

-contractionary fiscal policy:

+ it means that taxation is raised or public spending is reduced.

+ it helps to restrict demand , slow down the economy and control inflation.

- all kinds of fiscal policy are used in order to control overall economy with macroeconomic aims :

+ high employment level

+high economic growth

+balance of payments

+inflation

16) Talk about corporate finance and public finance and their differences?

- Finance is a field which is concerned with providing funds to individuals , businesses and government.

-many aspects of finance are studied individually, such as corporate finance and public Finance . They are 2 important kinds of finance.

Corporate finance is a field of finance concerned with how business can raise. And spend their money. Companies spend or invest funds in projects that might make the firm more profitable. It also involves selecting project that maximize profits and make the best use of a company's funds and finding the best way to pay a company's debt in case it must raise funds from the outside the company.

Public finance is the field of finance concerned with paying for activities of government, and with the administration and design of those activities. The field is often divided into question of what the government or collective organizations should do or are doing, and questions how to pay for those activities. It helps government carry on its functions and ensure social security , social defense..

- the differences:

+corporate finance is a field concerned with businesses , firms.. public finance is a field concerned with government.

+corporate finance focuses on how businesses can maximize their profits ,while with public finance ,profit aim is not the most important aim, because government want to use it to perform its social aims, such as : social security , social defense

17) By what way can a company raise its capital for production and business?

-A company can raise its capital for production and business from different sources.

-if the company has got an enough large amount of money for its plans , it can use this amount of money to perform its activities.

In case the company has not got enough money , it can raise by some ways:

+borrowing from banks or other financial institutions , such as : insurance company , credit unions... nowadays , there are many people who have idle money and they can send to banks or other financial institutions to get profits, so these organizations always have available money and when a company need money, it can borrow from them but must accept a loan interest rate.

+ a company also can borrow money from money from giving notes or bonds, and when it raise money by this way , it also must pay for people who owns notes or bonds a part of its revenue.

+ an other way for a company can raise money is issuing stock. People who own share of stock are called shareholders, and they also become owners of the company, they are shared company's profits.

18) Talk about forms of equity?

-Equity is capital which is used to invest in the business.

-forms of equity :

+the first of equity is owner's capital , this is the most exposed form of capital , because when the company is in extreme case bankruptcy - the owner's equity will be repaid only after everyone else, including employees , banks ,creditors... but in successful times ,the owners will have a claim on all the net profit of the company.

+the second is venture capital , which is provided by venture firms interested in financing high -growth companies. This source has high rate and fast return but it doesn't interfere in the company.

+another source of equity finance is unlisted securities market. It helps a company raise money from outside investors without losing much control of the company , but it is not as available , active and liquid as venture capital.

+the last source is the stock exchange .this is the long -term solution to raising capital by issuing shares. But at least 25 percent of the equity must be in public hands- thereby reducing the control of the original owners.

19)What is working capital?

-working capital is denotation by money of mobile assets. Mobile assets of a business include production mobile assets such as inventories of raw materials, work in progress... and circulation assets such as finished products.

-working capital is calculated as current assets minus current liabilities. If current assets are less than current liabilities, the company has a working capital deficit

- working capital can initially be broken down into 2 types : permanent and temporary .permanent working capital is tied up in keeping the business flowing throughout the year while temporary working capital is needed from time to time to take account of seasonal , cyclical or unexpected fluctuation in the business. The latter type is usually serviced from an overdraft facility.

20) How can a company manage its capital to make profits?

Capital plays an important role with a company in making profit , so all companies must have a suitable management with its capital.

+knowing exactly about the correct amount of capital in all business periods of the company.

+using capital logically such as : minimizing the stock of raw materials, minimizing cost of production because an enormous amount of capital can be soaked up if not well managed, but the company shouldn't control over-stringently , because it can lead to disruption in production . The company can uses its capital for important aims such as: improving factories, human... or invest in large projects.

+ selecting projects that maximize profits for the company. If the company specializes in some products or fields , it should concern with them to have the best effect . The company can invest in new products or fields but must be careful.

+ finding the best way to pay company's debts in case it must raise capital from outside the company. The company should found a reservation fund for ensuring to pay its debts.