UNIT 9 ECONOMICS
READING (10 marks)
1 Read the article and complete the summary below using no more than three words in each gap.
Use only words that best summarize the content of the article. 1 mark for each correct answer.
The citizens of countries ruled by democratic governments are used to regular elections being held. Governments change, but often this has
little immediate effect on a country’s economic growth. However, the situation can be different in countries ruled by unelected regimes, such
as those of the former Soviet Union.
When the government of an undemocratic regime falls, the country’s economy can experience major difficulties. Interest rates often rise,
natural resources may not be properly protected and economic stability can suffer. This loss of wealth can lead to poverty and to recession.
One reason for this is a reduction in investment from abroad. A typical pattern is as follows: a country’s leader falls, foreign investors leave,
there is a rapid decrease in the market value of the currency, unemployment increases and retail sales decline.
Many investors would rather put their money into overseas economies, which offer higher returns. However, they must be aware of the risks
involved. Businesspeople benefitted from the high interest rates offered by banks based in Cyprus. However, this model could not be sustained
and wealthy businesspeople lost huge amounts of money in Cyprus in 2013. Some say that these losses are unfair, but others say that the
investors got what they deserved.
Investors looking for a safer, long-term return can invest in the real economy of a country rather than simply saving their money in banks. Such
investments can fund jobs, develop new businesses, restaurants and shopping malls such as those found in the USA. Outside wealth can turn
a failing economy around. Russia is an example of what can happen. It was once dismissed as a country without hope, but it is now a financial
powerhouse. High returns offered to wealthy businesspeople by offshore banks are becoming increasingly rare, and there is now a chance that
Russia might be able to raise more money in taxes. This would lead to more investment in the Russian economy, leading to a better standard
of living for all.
If businesses invest in long-term projects such as factories, mining and resources needed for manufacturing, and if governments can establish
effective means of redistributing income through spending and taxation, their countries’ economies will become more stable and their societies
fairer.
States run by __________________
hold regular elections. However, when a non-democratic government falls, a
country’s_____________________
can suffer. 3. When important____________________ such as coal, wood
and cotton are wasted, the economy can decline dramatically. When an economy suffers badly, the country can
experience negative growth. This is known as____________________ typified by loss of jobs and increased poverty. This
can happen when there is a sudden loss of_________________________
coming from other countries. A drastic fall
in the value of a currency can lead to a reduction in _______________________, as people are no longer able to afford
the prices charged by shops. Some financial institutions offer very high
rates, although investors risk
losing a lot of money if the market fails. When people have more money to spend, there is an increased demand for
shops, sometimes built together within large American-style_________________________. Greater investment in an
economy can lead to a better_____________________
for a country’s citizens. Economies will become more stable
if businesses invest in large projects such as those needed for the
industry.
2
For each of the sentences (1-5) below, choose the word or phrase from the box that can replace the word in
bold without changing the overall meaning. You will not need to use all the words and phrases.1 mark for each correct
answer.
balance investment development market return occupation
stability financial system decrease
1
The economy is going through a very difficult period at the moment.
2
Please complete the form, including your name, address and profession
3
O ne of the benefits of our political system is its strength. In contrast, some countries are sometimes forced to
hold elections almost every year.
4
5
M y financial adviser was certain that my investment would soon lead to a healthy profit.
There has been little growth in the industrial sector since the 1980s.
.
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VOCABULARY (10 marks)
3
Read the extract from the article. Find synonyms for the words and phrases in bold in sentences 1–10. 1 mark
for each correct answer.
When the government of an undemocratic regime falls, the country’s economy can experience major difficulties. Interest rates often rise,
natural resources may not be properly protected and economic stability can suffer. This loss of wealth can lead to poverty, and to
recession. One reason for this is a reduction in investment from abroad. A typical pattern is as follows: a country’s leader falls, foreign
investors leave, there is a rapid decrease in the market value of the currency, unemployment increases and retail sales decline.
1
2
3
She lived in extremely poor conditions.
There has been a fall in the number of jobs available.
Building larger shops will lead to a rise in goods being bought by consumers.
4
New businesses need to find reliable sources of money to help them develop.
5
T his country’s system of trade and industry needs to be made more competitive.
6
7
8
9
During her career she gained a large amount of money and valuable possessions.
It is not easy to find people who will put their money into new businesses. ____________________
He is selling it for $100, but the usual price is closer to $120. ________________________________
Our country is going through a period when the economy is doing very badly and many people are losing
their jobs.
10
The number of jobs available is predicted to go up next year.
ACADEMIC WRITING SKILLS (10 marks)
4
Read the description of a graph presenting data on the sale of widgets. Complete gaps 1–5 with the best
sentence (A–F). You will not need one of the sentences. 2 marks for each correct answer.
The data shows the retail price of Widgets in 2012-2013. 1
.
The first graph shows how the price of both the older model ‘Widget One’ and the more modern ‘Widget Plus’ fell
dramatically over the course of that year following the introduction of the widget’s only rival so far, the ‘Wedglet’. The
Widget One retailed at approximately €800 during the first quarter of 2012. However, most retailers dropped the price to
around €500 in the second quarter. 2
. This newer model retailed at €850 when it was first
introduced, a small increase in price when compared with the initial retail price of the Widget
One. 3
.
The retail price of the Widget One continued to drop throughout the third and fourth quarters, and the product was
eventually withdrawn from the market. Sales of the Widget Plus continued to be fairly healthy during the third quarter of
2012. 4 .
Sales of the Widget Plus picked up following the January sales, but by the end of February sales had once again levelled out. 5
. Although the price of the Widget Plus was reduced following the news of its replacement model, sales fell to
almost zero. It was withdrawn from sale in the last quarter of 2013, by which time the Widget Plus One had established itself
as the market leader.
A
This followed the introduction of the newer Widget Plus.
B
T he dramatic drop in the final quarter can be explained by the anticipated introduction of the Widget
Plus One in early January 2013.
C
This dramatic increase is difficult to explain.
D
I t also shows how many widgets were sold during that period.
E
H owever, the difference is quite significant when compared with the price reductions on offer for the
older model following the introduction of the Widget Plus.
F
F The Widget Plus One was officially announced in March 2013.
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