Business English in Use

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BUSINESS ENGLISHIN USE


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CONTENTS

Introduction.....3

1 Financial crises: lessons from history.......5

2 European junk bonds growth is sign of health....10

3 No tax please, we're rich!....................................................................................................15

4 Student loans a life sentence19

5 Getting it right on the money..25

6 Tourism an Economic and Social Phenomenon..29

7 The environmen tal impact of tourism.33

8 Environment health and growth..38

9 Oil inferno...43

10 Microsoft and AOL time Warner....49

11 Loyalty marketing. Boring or booming......54

12 Nike and Apple join up for runs......60

13 The Strategy Hierarchy...65

14 Strategic Planning...71

15 Why Your Boss may Start Sweating The Small Stuff?......................................................75

16 Get Goals For Your Employees..80


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INTRODUCTION

General descriptionThis book is a course in Business English which is intended for higher intermediate/advancedstudents wishing to increase their knowledge of business theory and practice.

The course consists of sixteen units. The contents of these units are planning, motivation,appraisal and leadership, each which is illustrated by real examples from the world of

business. Thematically linked to the topic of each unit are a wide variety of languageactivities, designed to focus on business lexis and difficult points of grammar as well asdeveloping reading, writing, listening and speaking skills. The main emphasis of this book,however, is to develop the students' oral fluency and their ability to communicate effectively

in a wide range of business situations. It can be used either as a main course book or assupplementary material. It is also suitable for shorts courses; as such unit is entirely self-contented, allowing teachers to select material appropriate to the particular needs of theirstudents.

Aims of the course

1. The business aims are:a) to introduce students to the basic concepts of business

b) to stimulate students' interest in the subject and to encourage them to learn more about business

c) to present a range of business situations in the form of case studies, role-plays anddiscussions which familiarize students with the problems faced by managers and providethem with the opportunity to develop effective communication skills

2. The language aims are:a) to develop students' reading, writing, listening and speaking skills but, in particular, their

ability to express themselves accurately and effectively in business situations

b) to focus on language functions and structures which are particularly useful for managersc) to increase the students' knowledge of commercial vocabulary, specialist business termsand provide business idiom

d) to give students practice in writing business communications such as short reports,memoranda, advertisement and letters


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Organizations of the units

DISCUSSION

This section as an introduction to the topic(s) of each unit and usually takes the form of ashort reading passage, mini case study or dialogue, followed by a number of questionsintended to generate discussion. Discussion gives the students the opportunity to bring theirown knowledge and imaginations to the topics and related areas. They may wish to discuss allof the questions in their small groups or to select one on which to report back to the class.

READING

They deal with key to business ideas or practice and should therefore be of interest to businessexecutives wishing to learn more about the theories of business.

Understanding the main pointsThe reading passage is followed by a variety of comprehension-checking devices to ensurethat students have understood the most important ideas contained in the text. These includeopen-taking, grid completion and identifying the order to the main ideas.

Vocabulary focusHaving demonstrated that they have grasped the main arguments put forward in the passage,students are then asked to work through intensive reading exercises which are similar in

meaning to the synonyms or definitions given in the exercise, or using the context of the passage to help them to guess the meaning of vocabulary items taken from the text.

GRAMMAR

Grammar focuses on aspects of the language suggested by the reading passage itself. Theemphasis is on practice and reinforcement rather than teaching, while indirectly building onthe comprehension phase.

VOCABULARY

The vocabulary exercise is designed to help students become more self-reliant by encouragingthem to work out meaning from context. As suggested previously, this section can be doneduring the reading phase or afterwards or both. As in all exercise types is used.


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LESSON 1

The current market jitters are centred ondisturbances in the world's credit markets. Worriesabout the viability of sub-prime mortgage lendinghave spread around the financial system, and the5central banks have been forced to pump in billionsof dollars to oil the wheels of lending. But whathappened in previous financial crises, and what arethe lessons for today?

There have been a growing number of financial10crises in the world, according to the InternationalMonetary Fund (IMF). Among the key lessons of

previous major financial crises are: globalisationhas increased the frequency and spread of financialcrises, but not necessarily their severity; early15intervention by central banks is more effective inlimiting their spread than later moves; it is difficultto tell at the time whether a financial crisis willhave broader economic consequences; regulators

often cannot keep up with the pace of financial20 innovation that may trigger a crisis.

THE DOT.COM CRASH, 2000

During the late 1990s, stock markets became beguiled by the rise of internet companies such asAmazon and AOL, which seemed to be ushering in25a new era for the economy. Their shares soaredwhen they listed on the Nasdaq stock market,despite that fact that few of the firms actually madea profit. The boom peaked when internet service

provider AOL bought traditional media company30Time Warner for nearly $200bn in January 2000.But in March 2000, the bubble burst, and thetechnology-weighted Nasdaq index fell by 78% byOctober 2002. The crash had wider repercussions,with business investment falling and the US35economy slowing in the following year, a processexacerbated by the 9/11 attacks, which led to thetemporary closure of the financial markets. But theFederal Reserve, the US central bank, cut interestrates throughout 2001, gradually lowering rates40from 6.25% to 1% to stimulate economic growth.

When AOL's Steve Case took over Time Warner, thedot.com boom peaked

LONG-TERM CAPITAL MANAGEMENT, 1998 45

The collapse of hedge fund Long-Term CapitalMarket (LTCM) occurred during the final stage ofthe world financial crisis that began in Asia in 1997and spread to Russia and Brazil in 1998.LTCM was a hedge fund set up by Nobel Prize50winners Myron Scholes and Robert Merton to trade

bonds. The professors believed that in the long run,the interest rates on different government bondswould converge, and the hedge fund traded on thesmall differences in the rates. But when Russia55defaulted on its government bonds in August 1998,investors fled from other government paper to thesafe haven of US Treasury bonds, and interest ratedifferences between bonds increased sharply.LTCM, which had borrowed a lot of money from60other companies, stood to lose billions of dollars -and in order to liquidate its positions it would haveto sell Treasury bonds, plunging the US creditmarkets into turmoil and forcing up interest rates.So the Fed decided that a rescue was needed. It65called together the leading US banks, many ofwhom had invested in LTCM, and persuaded themto put in $3.65bn to save the firm from imminentcollapse. The Fed itself made an emergency rate cutin October 1998 and markets soon returned to70stability. LTCM itself was liquidated in 2000.


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THE CRASH OF 1987

Program trading on the New York stock market worsened75the crisis

US stock markets suffered their largest peacetimeone-day fall yet on 19 October 1987, when the DowJones Industrial Average index of shares in leading

US companies dropped 22% and European and80 Japanese markets followed suit. The losses weretriggered by the widespread belief that insidertrading and company takeovers on borrowed moneywere dominating the markets, while the USeconomy was entering into an economic slowdown.85There were also worries about the value of the USdollar, which had been declining on internationalmarkets. These fears grew when Germany raised akey interest rate, boosting the value of its currency.

Newly-introduced computerised trading systems90exacerbated the stock market declines, as sellorders were executed automatically. Concerns thatmajor banks might go bust led the Fed and othermajor central banks to lower interest rates sharply."Circuit-breakers" were also introduced to limit95

program trading and allow the authorities tosuspend all trades for short periods. The crashseemed to have little direct economic effect andstock markets soon recovered. But the lowerinterest rates, especially in the UK, may have100contributed to the housing market bubble of 1988-89 and to the pressures on the pound sterling whichled to the devaluation of 1992. The crash alsoshowed that global stock markets were now closelylinked, and changes in economic policy in one105country could affect markets around the world.Laws on insider trading were also tightened up inthe US and UK.

THE CRASH OF 1929

The Wall Street crash of 1929, "Black Thursday",110was an event that sent the US and indeed the globaleconomy into a tailspin, contributing to the GreatDepression of the 1930s. After a huge speculativerise in the late 1920s, based partly on the rise ofnew industries such as radio broadcasting and car115

making, shares fell by 13% on Thursday, 24October. Despite efforts by the stock marketauthorities to stabilise the market, stocks fell by

another 11% the following Tuesday, 29 October.By the time the market had reached bottom in 1932,12090% had been wiped off the value of shares. It took25 years before the Dow Jones industrial averagerecovered to its 1929 level.The effect on the real economy was severe, as

widespread share ownership meant that the losses125 were felt by many middle-class consumers. Theycut their purchases of big consumer goods such ascars and homes, while businesses postponedinvestment and closed factories. By 1932, the USeconomy had declined by half, and one-third of the130workforce was unemployed.

Franklin Roosevelt became US President after the crash

The whole US financial system also went intomeltdown, with a shutdown of the entire banking135system in March 1933 by the time the newPresident, Franklin Roosevelt took office andlaunched the New Deal. Many economists on bothleft and right have criticised the response of theauthorities as inadequate. The US central bank140actually raised interest rates to protect the value ofthe dollar and preserve the gold standard, while theUS government raised tariffs and ran a budgetsurplus. New Deal measures alleviated some of theworst problems of the Depression, but the US145economy did not fully recover until World War II,when massive military spending eliminatedunemployment and boosted growth. The New Dealalso introduced extensive regulation of financialmarkets and the banking system through the150creation of the Securities and ExchangeCommission (SEC) and the Federal DepositInsurance Corporation (FDIC), and the separationof commercial and retail banking through theGlass-Steagall Act .155

www.bbc.c


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I. VOCABULARY

1. Decide whether the following statements are true (T) or false(F)

1. Early intervention by central banks is more effective in limiting their spread than later

moves. T F

2. Franklin Roosevelt became US President before the crash. T F

3. LTCM was a hedge fund set up by Nobel Prize winners Myron Scholes and Robert Merton

to trade bonds. T F

4. There have been a small number of financial crises in the world. T F

2. Match the words on the left with the definitions on the right.1. financial crises A integration of national economies into the

international economy through trade, foreign direct

investment, capital flows, migration, and spread of

technology2. central bank B a private or public market for the trading of

company stock and derivatives of company stock at

an agreed price

3. stock market C is the entity responsible for the monetary policy of

a country or of a group of member states

4. stock exchange D situation when money demand quickly rises

relative to money supply
http://en.wikipedia.org/wiki/Market_systemhttp://en.wikipedia.org/wiki/Tradehttp://en.wikipedia.org/wiki/Corporationhttp://en.wikipedia.org/wiki/Stockhttp://en.wikipedia.org/wiki/Derivative_%28finance%29http://en.wikipedia.org/wiki/Monetary_policyhttp://en.wikipedia.org/wiki/Monetary_policyhttp://en.wikipedia.org/wiki/Derivative_%28finance%29http://en.wikipedia.org/wiki/Stockhttp://en.wikipedia.org/wiki/Corporationhttp://en.wikipedia.org/wiki/Tradehttp://en.wikipedia.org/wiki/Market_system


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5. economic globalization E corporation or mutual organization which provides

facilities for stock brokers and traders, to trade

company stocks and other securities

II. EXERCISES

1. Phrasal verbs

Match the verbs with their correct definitions:1. look after A a chance to do something or to succees

2. look forward to B to improve

3. look in C to care for or be in a charge of

4. look up D to watch what is happening and be careful

5. look out E to feel pleasure that something is going to

happen
http://en.wikipedia.org/wiki/Corporationhttp://en.wikipedia.org/wiki/Corporationhttp://en.wikipedia.org/wiki/Mutual_organizationhttp://en.wikipedia.org/wiki/Stock_brokershttp://en.wikipedia.org/wiki/Trader_%28finance%29http://en.wikipedia.org/wiki/Stockhttp://en.wikipedia.org/wiki/Security_%28finance%29http://en.wikipedia.org/wiki/Security_%28finance%29http://en.wikipedia.org/wiki/Stockhttp://en.wikipedia.org/wiki/Trader_%28finance%29http://en.wikipedia.org/wiki/Stock_brokershttp://en.wikipedia.org/wiki/Mutual_organizationhttp://en.wikipedia.org/wiki/Corporation


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2. Put each of the following colloquial pair-phrases in its correct place in the

sentences below.

safe and sound ups and downs odds and ends

up and about sick and tired to nod fr o ins and outs

down and out pros and cons spick and span

1. Im ________ of his continual bad behavior.

2. Shes ver y house-proud. Her kitchen is always ________.

3. I just keep various _________ in the drawer, nothing special.

4. Like everyone else, she has her _________ of course, but on the whole shes quite satisfiedwith life.

5. He lost everything, family, job, mo ney, homeNow hes _______ and sleeping in the

park.

6. You should consider the ________ carefully before you make a decision.

7. Shes ill in bed, but shell be _______ in a couple of days.

8. The parents were beginning to worry but finally the children arrived home _______.

9. This ferry-boat operates between England and France. It just goes ________ all the time.10. Hes the right man for the job. Hes experienced. He knows the ________ of the business.

3. Discussion

1. What can we learn from financial crises in the past?

2. How did central bank react on the crush of DOT.COM and LTCM?

3. What is New Deal?


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LESSON 2

The European junk bond market grew

dramatically in the first quarter of this year in a

powerful sign that the world economy is in robust

health. Only two months after stock markets fell

sharply round the globe, the big jump in high-5yield bonds suggests the economy rode the storm,

according to the European High Yield

Association.

It said new issuance in the first quarter of this

year jumped 78.9 per cent, compared with the10same period last year, on the back of mergers and

acquisitions, private equity-led leveraged buy-

outs and strong economic fundamentals. Gilbey

Strub, executive director of the EHYA, said:

The Eu ropean macro- economic environment15continues to be favorable due to very low interest

rates while issuance levels are being driven by

mergers and acquisitions and leveraged buy-out

transactions. New issuance in the European junk-grade market in the first q uarter stood at 12.7bn20($17.28bn) compared with 7.1bn in the same

period last year, the EHYA said.

This suggests that fears the market had peaked

after the sell-off at the end of February, as

investors switched out of relatively risky asset25classes such as high-yield bonds to safer havens

of government debt and high-grade investment

paper, were unfounded. A number of high-yield

bond issues were delayed or scrapped in Europe

at the time because of the volatility although the30US high-yield debt markets proved more

resilient. Diane Vazza, head of global fixed

income research at Standard & Poors, said: If

February brought on a sneeze, March did not

result in a cold. The US high-yield bond market35steadied its balance after an ungainly month.

Having begun March with a lurch, she added,

volatility subsided into April in spite of concerns

over problems in the sub-prime mortgageindustry.40

Default rates and credit rating downgrades

remained low as equity markets rebounded. In the

US, new issuance levels in both high-yield and

leveraged loan markets were buoyant in the first

quarter, also largely driven by M&A activity and45other shareholder-friendly corporate actions. A

record total of $224bn in high-yield debt was brought to market in the first quarter, 80 per cent

of which was leveraged loans, according to S&P.

50


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"Risk appetite reappeared, with the credit markets

continuing to offer cheap funds for myriad uses,

including leveraged acquisitions and dividend

recapitalizations strategies that may be

ultimately unhelpful for its own health," said Ms55Vazza. Ms Strub said M&A activity and private

equity were big factors behind growth in the

high-yield and leveraged loan space. Globally,

M&A activity topped $1,000bn in the first

quarter, making it the busiest, most lucrative first60quarter on record a boom driven by record

private equity deals, according to data provider

Dealogic.

The Financial Times


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EXERCISES

1. Match the words on the left with the definitions on the

right:

1. merger A the extra money that you pay to a bank,

company, etc. which has lent you money

2. interest B when someone buys or sells something,

or when money is exchanged

3. transaction C money that you borrow to buy a home

4. debt D when you owe money to someone

5. income E when two or more companies or

organizations join together

6. mortgage F money that you earn by working,

investing or producing goods


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2. Find the synonyms for the following:

1. merger

2. promissory note

3. due

4. equity

5. stock market

3. Decide whether the following statements are true (T) or false(F):

1. The European junk bond market grew dramatically in the first quarter of this year.

T F

2. The European junk bonds growth sign that the world economy isn't health.

T F

3. Ms Strub said M&A activity and private equity werent important factors behind growth in

the high-yield and leveraged loan space. T F

4. Default rates and credit rating downgrades remained low as equity markets rebounded.

T F


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high

4. Fill the gaps in these sentences with words from the list

below:

1. The European junk bond market ___________ dramatically in the first quarter of this year.

2. The big jump in ___________ suggests the economy rode the storm.

3. New issuance in the European junk-grade market in the first quarter __________ at

12.7bn.

4. A record total of $224bn in high-yield debt ____________ to market in the first quarter of

this year.

5. Discussion1. What happened in the European junk bond

market in the first quarter of this year?

2. Why a number of high- yield bond issues

were delayed?

3. Which big factors were behind growth it the

high yield and leveraged loan space?

high yield bonds stood was brought grew


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LESSON 3

Some of Britain's richest people pay

remarkably little tax. A Money Programme special

investigates how they do it. Billionaire retailer Philip

Green manages it because his family moved to

Monaco. Arsenal football stars have done it with5offshore trusts in Jersey. Top City traders did it by

being paid in gold or wine. Others do it by taking

loans instead of income. And it is all completely

legal. We have met tax advisers who claim to be

able to make National Insurance, income tax - and10even inheritance tax - vanish.

And we can reveal some of the

extraordinary devices top tax professionals have

used to slash tax bills for their clients - and

themselves. Some leading accountants even manage15to get themselves up to 40% tax relief on their own

home loans - while the modest 10% tax relief

available for the rest of us was abolished years ago.

Since taxes were first imposed, people have

tried to pay as little as they legally can. But a20modern wave of tax avoidance got under way during

the boom of the late 1980s. Many leading financial

institutions avoided employers' National Insurance

contributions by paying employees' bonuses in gold,

rather than cash. On a 1m bonus, this could save25them 100,000 - which could then be shared with

the lucky employee. When the Revenue clamped

down on this wheeze, City employers began to pay

in a variety of other goods - diamonds, antiques,

carpets, fine wines, and even hay and animal skins.30

All had the same purpose: to avoid tax.

Accountant Adrian Walker, whose firm

Jefferson Wells refuses to get involved in tax35avoidance schemes, told the Money Programme

that despite the exotic means of payment, it was

all very simple for the recipients. "You get a piece

of paper saying that sitting in a bank somewhere

is your little stash of gold," says Mr Walker. "You40can then take your paper to a bank or a trader, and

get it cashed in." Later, clever accountants came

up with other schemes which could save theirclients income tax. One popular device was the

"employee benefit trust". Instead of paying45 bonuses or big salaries directly - which would

incur income tax bills - the money would instead

be paid through a trust, often offshore. The trust

would then forward the cash in the form of very

long term, often interest-free loans. And with50loans, there's no tax to pay. These schemes were

called "lend and forget".


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The lawyer who claims to have come up

with this device, Paul Baxendale-Walker, is proud

of the service he offers clients. "I'm actually helping55to cure people of various ills, various cancers," says

MR Baxendale-Walker. "Because tax is a cancer thatwill kill your business if it's not treated. So I see

myself as a doctor too.

60

For HM Revenue and Customs, the latest

wave of tax avoidance schemes was the last straw.

Often fiendishly complex, they nevertheless have a

simple idea behind them. Accountancy firms sell

"losses", to set against clients' incomes. So with65income apparently wiped out, there's no income tax

to pay. But here's the really clever part: the losses

are purely artificial - so the clients keep all their

income, yet have still avoided income tax bills.

These "loss creation" schemes have cost70

Revenue and Customs - and the country - 2.5bn inavoided taxes. Britain's tax authorities are trying to

crack down. Dave Hartnett, Revenue and

Custom's top tax enforcer, says he aims to make

tax avoidance "not worthwhile by 2008". He has75new powers to help him. A new anti-avoidance

unit has been set up by Revenue and Customs,and schemes have steadily been closed down.

Most significantly, though, accountants now have

to disclose their tax-cutting ploys as soon as they80have been offered to clients. Mr Hartnett has a

stern warning for those who choose not to

disclose new avoidance schemes: "If people are

behaving dishonestly here, then an issue can

easily slip across from being a matter of legal85avoidance, into one of dishonesty and evasion -

and could become a criminal case for us." But

Paul Baxendale-Walker says Revenue and

Custom's crackdown could be self-defeating. If

the taxman gets too demanding, wealthy90individuals and companies will simply relocate

abroad. "The more they squeeze the pips, then the

more that the fruit is simply going to leave the

tree."

Roger Munns, who runs a property95consultancy, says for people keen on avoiding

taxes it will not take long to move to places like

Monaco: "The wealth creators, the entrepreneurs,

are quick on their feet. They are quick-thinking

and they know what to do.100

BBC Money Programme


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I. VOCABULARY

The following phrases are associated with particular situations. Identify each phrase by

describing briefly who would say it and in what circumstances.

E.g. Please fasten your safety-belts.

Air-stewardess to passengers before take-off or landing.

1. Mind the doors!

2. To eat here or take away?

3. Many happy returns.

4. How do you plead?5. Just a trim, please.

6. Have you anything to declare?

7. Heel!

8. Take this prescription and come back and see me in week.

9. Im putting you through.

10. A paint of bitter, please.

II. EXERCISES

1. Phrasal verbs

Match the following verbs with the correct definitions:

1. turn up A do something in an agreed order2. turn down B the amount of sales in a certain period of time

3. turn over C do business or sell goods worth a certain amount

4. turn round D make a business profitable again after it has had

5. turn out losses

6. turn against E produce

7. take turns F refuse, reject

8. turnover G change one's attitude and become hostileH arrive, appear


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2.Grammar

Complete these sentences with the right preposition:

1. Everybody laughed ____________ the joke.

2. We were very pleased ____________ the hotel.

3. She says she is found a solution ____________ the problem.

4. It took her a long time to recover _____________ the accident.

5. Do you believe _____________ life after death?

6. I apologized __________ Sam ___________ breaking the chair.

7. She is very proud ____________ her new motor bike.

8. The house is quite close ____________ the shops.

3. Reading

Read the text again and answer the questions:

1. What percent of tax relief some leading accountants manage to get themselves?

2. When did the modern wave of tax avoidance start?

3. In which goods did employers begin to pay?

4. What is the name of the device which clever accountants came up with, which

could save their clients income tax?

4. Discussion:

1. What do you think about some of the devices which tax professionals use to cut

the tax bills for their clients?

2. Would you use that kind of service?

3. Would you move to Monaco to avoid paying the tax if you were rich?


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LESSON 4

NEW YORK (CNNMoney.com) - Mayrose

Wegmann, 25, should have been starting on

her dream career as a political consultant by

now. And saving toward her first home.

Instead, Wegmann, who graduated with a5degree in political science and journalism

from the University of Iowa in 2004 and

moved to Washington, D.C., is working at a

non-profit because it pays significantly more

than entry-level politics work. And she won't10even consider buying a home for several

more years. In fact, she won't consider much

except how to meet the $300 a month she

owes on her $34,000 student loan balance.

"The school debt makes you decide [about15your career] based on the money factor. Not

based on what you want to do," saidWegmann.

The Class of 2006, set to graduate this

month, will soon be in the same boat.20

Approximately two-thirds of all students use

loans to pay for their higher education,

according to the Center for Economic and

Policy Research. The average debt is$15,500 for public schools and $24,600 for25

private many students rack up even more

on their credit cards.

Call it a reverse dowry: college debt diverts

careers and delays or impedes graduates'

plans to get married, buy a home or even to30start a family. The effects can last years.

A 22-year old student graduating this year

who consolidates their $40,000 loan at 6.125

percent will need to pay $243 a month...until

they're 52. By that time, they will have paid35$47,494 in interest alone.

A reverse dowry

"My student loan debt is my biggest source

of stress in my life at the moment," said40Steve Desroches, a 2002 graduate from

Columbia University's Graduate School of

Journalism. "I live paycheck to paycheck."
http://images.google.hr/imgres?imgurl=http://www.usoge.gov/pages/comp_web_trng/cwt_modules/oge450_wbt_06/debt.gif&imgrefurl=http://www.usoge.gov/pages/comp_web_trng/cwt_modules/oge450_wbt_06/22a.html&h=1013&w=750&sz=47&hl=hr&start=155&tbnid=ghX9Z3L3apVkEM:&tbnh=150&tbnw=111&prev=/images%3Fq%3Dstudent%2Bloans%26start%3D144%26gbv%3D2%26ndsp%3D18%26svnum%3D10%26hl%3Dhr%26sa%3DN


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The degree left Desroches, who works for a

newspaper on Cape Cod, $50,000 in debt45with no savings. He's unable to buy a

needed car or to even think about entering

Massachusetts's "out of control" real estatemarket.

The repayments were so financially50restrictive he briefly considered declaring

bankruptcy, until he learned it wouldn't affect

his student loans because they're federally

guaranteed.

"My feelings about my degree now? My55graduate education was invaluable [to my

career], but it wasn't worth $50,000, or more

accurately, it isn't worth the debt. My options

are definitely limited."

Christine Moellenberndt of Sacramento,60California has given up on the idea of owning

a home, at least anytime in the next 10-15

years. She graduated last June from theUniversity of California, Santa Cruz with a

degree in anthropology, and moved back in65with her mother when she realized not doing

so would mean living paycheck to paycheck

with no chance of paying down her debts.

"That $675 I could be spending in rent could

also be a good chunk of a credit card70payment, or a huge payment for my student

loans. I see that as a bit of a better

investment than living on my own and

struggling paycheck to paycheck."

Moellenberndt says at least half her monthly75income working at a state regulatory agency

goes to pay off her $18k in federal student

loans. And although the debt is daunting, her

plans to become a community college

professor call for an advanced80degree...hiking her debt in the future.

A growing issue for the economy and

society

The cumulative effect of such student debt

on graduates is unclear, although few would85argue that its impact will be positive for the

graduates, the economy or society.

"We've never done this to a generation of

young people before," said Dr. Heather

Boushey, Senior Economist at the90progressive Center for Economic and Policy

Research. "We've never put a generation in

their 20s in debt they can't get out of before

they started their work life."

"The normal approach in any healthy society95is to help young married couples get started

in life through marital gifts, dowries, and thelike," Allan Carlson of the socially-

conservative Howard Center for Family,

Religion, and Society said.100

"We now burden many young adults with

student debt, sometimes massive in nature;

the price being paid includes marriages

delayed or foregone and fewer children. This

is foolish public policy."105

www.CNNMoney.com


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I. VOCABULARY

Match up these terms with the definitions bellow:

student loan school debt rack up

repay savings

1. Gradually increase in number or amount.

2. Sum of money which is borrowed by a student, often from a bank, and has to be paid

back.

3. Amount of money prevented from being wasted or spent.

4. Sum of money that needs to be paid to school or university.

5. To pay back.

II. EXERCISES

1. Complete the following sentences with appropriate words fromthe box:

month ly income school debt rack up student loan

savings repayments paycheck to paycheck

1. The degree left Desroches, who works for a newspaper on Cape Cod, $50,000 in debt

with no ___________________.

2. In fact, she won't consider much except how to meet the $300 a month she owes on her

$34,000 _____________________balance.

3. Moellenberndt says at least half her ______________________working at a state

regulatory agency goes to pay off her $18k in federal student loans.


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4. The _________________were so financially restrictive he briefly considered

declaring bankruptcy, until he learned it wouldn't affect his student loans because they're

federally guaranteed.

5. I see that as a bit of better investment than living on my own and struggling ___________.

6. The average debt is $15,500 for public schools and $24,600 for private many students

_________________even more on their credit cards.

7. The _______________makes you decide [about your career] based on the money factor.

2. Phrasal verbs

Match the verbs with their correct definitions.

1. give away A to stop

2. give in B to agree that you have been defeated

3. give on to C to stop doing or having (something)

4. give out D to open in the direction

5. give over E to tell people (something secret)

6. give up F to finish or to not work any longer

Complete the following passages with phrasal verbs from the list above.

1. She was determined not to __________ until she received compensation for the accident.

2. She wouldnt __________ any details of the plan.

3. Its time you _________ pretending you were still a teenager.

4. The patio doors ________ a small courtyard.

5. After her death he ________ grief.

6. Were going to ________ our sports club membership after this year.


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3. People often react to certain situations by using sounds rather

than real words, and people from different countries often use

different sounds.

Answer the questions below with sounds from the following list.

giddy up! mm! eh? (r hymes wi th say) wow!(r hymes wi th how)

whoah! sh! Boo! (r hymes wi th too) there, there whoops! well?

What do you say if you.

1. want someone to be quiet?

2. dont catch what a friend says?

3. want a horse to start or go faster?

4. comfort a child in a pain and crying?

5. jump out from behind a tree to surprise someone?

6. suddenly lose you balance, or drop something?

7. ar e waiting for someone to answer your question?

8. are suddenly impressed by something?

9. want a horse to slow down or stop?

10. ..express spontaneous delight?


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4. Reading

Read the text again and answer the following questions:

1. Why is Mayrose Wegmann working at a non-profit?2. How many students use loans to pay for their higher education according to the Center for

Economic and Policy Research?

3. Why did Christine Moellenberndt move back in with her mother?

4. What happens with young adults with student debt according to Allan Carlson?

5. Discussion

1. Is there possibility of getting student loans in Croatia?

2. Would a student loan have a great effect on your life in future?


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LESSON 5

EVERYBODY wants it. Nobody understands it.

Money is the great taboo. People just won't talk5about it. And that is what leads you to subprime.

Take the greed and the financial misrepresentation

out of it, and the root of this crisis is massive levels

of financial illitera cy.

Fools and the i r money10

(1)___________________________a substantial

proportion of the general public in the English-

speaking world is ignorant of finance, writes Niall

Ferguson, an historian at Harvard University, in his

forthcoming book about the history of finance,15The Ascent of Money. He produces a long list of

evidence to support this conclusion.

(2)______________________________________,

four in ten American credit-card holders do not pay

the full amount due every month on the credit card20they use most often, despite the punitive interest

rates charged by credit-card companies. Nearly

one-third said they had no idea what the interest

rate on their credit card was.

Financial illiteracy is not limited to subprime25mortgage borrowers, then; it is pervasive in all age

groups, income brackets and countries. Subprime

is a mere symptom, says Mr. Ferguson, noting that

many of the students he has taught in the best

universities in the world, including MBA30 programmers, don't even know the difference

between the nominal and real interest

rate.(3)__________________________________ ______________________, because governments

35

and businesses have pushed more of the

responsibility for financial well-being onto40individuals, whether by encouraging

homeownership or by promoting personally-

managed retirement accounts rather than defined-

benefit pensions.

If you can m ake i t there45

One of the most interesting attempts to combine

teaching and superior products is taking place in

New York, championed by a mayor, Michael

Bloomberg, who made his fortune selling financial

information.(4)_____________________________ 50 _____________, which is trying to use the powers

of government to promote both financial education

and better design of financial products.

(5)_______________________________________

_________, which often fail to provide the products55that poor consumers most want. That, at least,

seems to be the conclusion of a recent survey in two

of New York's poorer neighborhoods. Many people

were using fringe financial products such as pay-day loans or money orders rather than the services60of mainstream banks.

The mainstream financial providers are missing

genuine markets, says Mr. Mintz. One of the open

secrets in this industry is that when people are

engaged in behaviour that seems irrational, often it65has a rational basis. Which only goes to show that

consumers are sometimes only as literate as the products the financial-services industry chooses to

sell them . ( Economist, 2008.)


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I.READING

Read the text and complete the paragraphs using the sentencesbelow.

a) Indeed, one of the biggest problems may be the illiteracy of financial-service firms,

b) It is a well -established fact that

c) He has created an Office of Financial Empowerment,

d) This problem is more pressing than ever, he adds,

e) According to one survey last year,

II. VOCABULARY

Match the words from the text with their corresponding

definitions.

1. pervasive2. survey

3. taboo

4. mainstream

5. fringe

A meant not to do sth or talk about sthB the act of examining and recording the measurements; a

general study

C existing in all parts of a place or thing

D the outer edge of an area or a group

E the ideas and opinions that are thought to be normal because

they are shared by most people


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III. EXERCISES

1. Put each of the following words or phrases in its correct place

in the sentences below.

broke quid mortgage

hi re purchase chickenfeed make ends meet installment

1. Im afraid I have no money at all. Im completely ____________.

2. She finds London very expensive. She says she cant ____________ on less than 100 a

week.

3. To a multi-millionaire 100 is ___________.

4. Can you lend me a couple of ___________?

5. I managed to get a ___________ to buy a house. Ill be paying it back for the next 20

years.

6. He lent me the money but he didnt trust me completely and asked me to give him an

__________.

7. I couldnt really afford the car so I got it on __________ and paid monthly until it was

finally mine.


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2. Put the verbs in correct form.

1. Once this room is finished, we ____________(paint) six of seven rooms in the house.

Not bad for two days work.2. By the time we reached Frankfurt I ____________(already/be) very tired of driving.

3. There was a terrible atmosphere in the room. But once I ____________(bring) the

matter out in the open, everyone seemed much more relaxed.

4. Who knows what _____________(may/happen) if you had accepted the job in South

America last year.

5. How long _____________(you/live) there before coming here?

6. She ____________(live) in this house for years.7. My friend is a teacher . Really? How long _____________(she teach).

3. Discussion1. Have we become too materialistic?

2. What role will money play in the world in the future?

3. How important are materialistic possessions in your life?

4. What kinds of things in life do you think bring true happiness?

5. What does the way we spend our money show about us?


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LESSON 6

Over the decades, tourism has experienced

continued growth and deepening diversification to

become one of the fastest growing economic

sectors in the world. Modern tourism is closely

linked to development and encompasses a growing

number of new destinations. These dynamics have

turned tourism into a key driver for socio - economic

progress.

Today, the business volume of tourism equals

or even surpa sses that of oil exports, food products

or automobiles. Tourism has become one of the

major players in international commerce, and

represents at the same time one of the main income

sources for many developing countries. This

growth goes hand in hand wi th an increasing

diversification and competition among

destinations.

This global spread of tourism in

industrialised and developed states has produced

economic and employment benefits in many related

sectors - from construction to agriculture or

telecommunications.

The contribution of tourism to economic

well - being depends on the quality and the revenues

of the tourism offer. NWTO assists destinations

in their sustainable positioning in ever more

complex national and i nternational markets. As the

N agency dedicated to tourism, NWTO points

out that particularly developing countries stand to

benefit from sustainable tourism and acts to help

make this a reality.

ey numbers:

From 1950 to 2005, international tourism

arrivals expanded at an annual rate of

6.5 , growing from 25 million to 806

million travelers. The income generated by these arrivals

grew at an even stronger rate reaching

11.2 during the same period,

outgrowing the world economy, reaching

around S$ 680 billion in 2005.

While in 1950 the top 15 destinations

absorbed 88 of international arrivals, in

1970 the proportion was 75 and

decreased to 57 in 2005, reflecting the

emergence of new destinations, many of

them in developing countries.

Cur rent developments & forecasts:

Worldwide arrivals reached 842 million in

2006, representing a 4.6 year on year

growth.

By 2020 international arrivals areexpected to surpass 1.5 billion people.

www.unwto.org
http://www.unwto.org/http://www.unwto.org/http://www.unwto.org/


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I. EXERCISES

1. Complete the summaries using the phrases given.

fur thermore besides whi le also moreover both as well as

Tourists help the economies of the places they visit, (1) .......... by directly providing

jobs in the tourism industry and by spending money on other local goods and services. (2)

.........., in some cases, income from tourism is spent on conserving the local environment. (3)

..... ..... spending money, the presence of tourists can (4) .......... help make peoples daily livesmore varied and interesting.

The local community can benefit from the interest created by having different people

pass through, (5) .......... the environment can improve if money from tourism is invested in

conservation. (6) .........., (7) .......... providing employment for lots of local people in hotels

and other tourist facilities, the economy can benefit from increased spending on shopping and

souvenirs.

2. Read the two correct summaries again and answer thequestions.

1. How does the organization of information differ in the two summaries? 2. Is there a logical structure to the way that the information is presented? 3. Which words and phrases are used to indicate that the sentence is making a new

point?


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3.Expressions with run, look and catch

Match the phrases with run, look and catch.

a business

somebody red-handed

on the bright side

run out of

look short of

catch down your nose at

for it

like a drowned rat

someones eye

a gift horse in the mouth

II.GRAMMAR

1. Describing trends and change . Correct the mistake in each

sentence.

1. The price of home computers has reduced dramatically.

2. More and more people buy air tickets on line nowadays.

3. In the past six months, the rate of inflation doubled .

4. I am having less and less free time these days.

5. There has been a steady increase of the number of car thefts.

6. Its getting more and more easy to find a job.

7. The divorce rate has increased strongly over the last ten years.

8. These days, people are working increasingly longer hours.


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2. Put the verbs in brackets into a correct form.

1. We ___________ TV when it started to rain. (to watch)

2. I _________ to visit you yesterday, but you ___________not at home. (to watch, to be) 3. Look! It__________, so we can't __________to the beach. (to rain, to go)

4.There are a lot of clouds! It ____________soon. (to rain)

5. The sun __________ in the East. (to rise)

6. Since 2003 they __________ their son every year. (to visit)

7. While the doctor _________ Mr. Jones, his son _________ outside this morning. (to

examine, to wait)

8. I _________ for my girlfriend for two hours. (to wait)

9. After Larry _________ the film on TV, he decided to buy the book


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LESSON 7

Tourism is ever more frequently praised as an

important instrument of nature conservation.

Income of tourism can help to finance protected

areas and to safeguard ecologically sensitive

regions against more environmentally damaging5alternative uses. Nature-based tourism can

contribute to promoting the environmental

education of both tourists and the local

population. However, tourism is not the white

industry that it likes to call itself.10Tourism is responsible for a

considerable proportion of burgeoning global

transport volumes and associatedenvironmentally damaging pollutant emissions.

The arrival in a holiday destination is generally15 by car, bus, aircraft or railway. Tourists consume

about 90 percent of the primary energy required

during a holiday for transportation during their

arrival and return journey. The emissions

generated by this are one of the main20environmental problems of tourism Particularly

the pollution caused by air transport which islargely for tourism - is continuously rising, with

an annual growth rate around 5 percent. Air

traffic is expected to double over the next 1525years. Worldwide civilian air transport already

consumed 176 million tons of kerosene in 1990,

releasing 550 million tons of carbon dioxide and

more than 3 million tons of nitrogen oxides.

While it has been possible to halve energy30consumption per aircraft over the past 20 years,

the rapid growth in global air traffic has meant

that absolute energy consumption has

nonetheless risen by 50%. As do other sectors,

tourism consumes resources and generates35wastes. It is frequently in conflict with other

forms of resource use, sometimes it is

complementary. An intact balance of nature is

one of the essential foundations of the tourism

sector. However, the environmental damage40

caused by tourism can go so far that the regionloses its attractivity as a destination and is no

longer visited by tourists as has already

happened in certain Mediterranean regions.

The high water demand of tourists is a45major problem, particularly in areas where water

resources are scarce, as here the tourists are often

supplied at the cost of the local population. In

most tourism regions in developing countries,

wastewater and solid waste disposal are not50 properly managed. Tourism centre with greatly

increased solid waste and wastewater risings are

already sources of serious ecological damage and

health risks. The land requirement of tourism is

enormous, as it often develops separately from55autochthonous infrastructure and land use. Thus


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the construction of land-intensive hotels and

camps, camping sites, golf courses and sports

facilities or of tourism-oriented transport

infrastructure (access roads, parking lots,60funiculars and airports) only indirectly has a

positive effect for the local population, while

leading to massive environmental damage:

Coastal areas are dammed in, wetlands are

drained, dry areas are irrigated, forests are cut65down and coral reefs are blasted. The great

demand for building materials in the tourist

centers leads to construction sand being

extracted in large quantities from the beaches,

limestone from the coral reefs and construction70timber from the coastal mangrove forests,

whereby the ecosystems involved suffer massive

damage. Where tourists or dealers collect corals

and shells, this impairs coral reefs and the

species composition of ecosystems. The trade in75 products of endangered animal and plant species

is frequently in violation of species conservation

laws.

Many tourism activities such as skiing,skin diving, boating, mountain hiking and 680trekking stress natural areas and their animal and

plant life. In many cases it is precisely nature-

based tourism, which opens up previously

undeveloped natural areas to tourism activities,

that causes or exacerbates ecological85degradation. Thus for instance trekking tourism

creates environmental stress in mountain regions

through wastes and logging.The European

90

95


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EXERCISES

1. Explain in your own words the meaning of the following

sentences and discuss them:

1. Nature-based tourism can contribute to promoting the environmental education of bothtourists and the local population.

2. An intact balance of nature is one of the essential foundations of the tourism sector.

3. In most tourism regions in developing countries, wastewater and solid waste disposal are

not properly managed.

2. Complete the following sentences using the words: species ,"white industry" , violation , damage , arrival and region :

1. The branch known as tourism is not quite a _______________ that it likes to call itself.

2. The ___________ in a place where you are about to spend your holiday is generally by

car, bus, plane or train.

3. The ______________ to the environment caused by tourists can even go so far that the

____________ in the future could lose it's attractively as a destination.4. In situations where tourists collect corals and shells, this damages coral reefs and the

_______________ composition of entire ecosystems.

5. Trading with products of endangered animal and plant species is often in _____________

of species conservation laws.


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3. Read the sentences and decide whether the following

statements are true(T) or false(F):

1. Tourism is not responsible for environmental damaging. T F 2. Tourism likes to call itself the "white industry". T F 3. A major problem of tourists is the high water demand. T F 4. Many tourism activities stress natural areas. T F 5. Income of tourism can't help to finance protected areas. T F

6. Tourism consumes resources and generates waste. T F

4. Find words in the text which are synonyms for the words or

expressions below:

1. preservation or restoration of the natural environment and wildlife (paragraph 1)

2. the action of emitting something, especially heat, light, gas, or radiation (paragraph 2)

3. the action or process of consuming (paragraph 2)

4. relates to the whole world (paragraph 2)

5. Match the phrasal verbs on the left with the definitions onthe right:

1. running through A examine

2. run eye over B show someone how to do it

from beginning to the end

3. in the short run C leave before it is finished

4. to walk out on (someone) D moving along within

5. walk (someone) through E in the near future

6. walk out (of something) F end the relationship with someone


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6. Put each of the following phrases in its correct place in the

sentences below.

out of the blue in the red a black sheep

once in a blu e moon red tape green with envy

to have green f in gers in black and whi te to catch someone red-handed

1. The offer of a job sounded very good on the phone but I shant believe it till I have it

__________.

2. I must remind you that this is a non-smoking office. I suspect that some of you have been

smoking. If it happen _________, Im afraid it will mean dismissal.

3. To import firearms into Britain youll have to fill in a lot of forms. Theres a lot of

_________.

4. If you want to be a successful gardener, of course youve got __________.

5. The rest of the family were respectable, honest people but he was always in trouble. Im

afraid he was __________.6. When I saw him in a new sports car, I was __________.

7. Tourists often go to the Louvre but most Parisians only go _________.

8. The firm is ________. It owes a lot of money.

9. I had lost touch with Jack, and then one night he arrived at my flat right _________. What

a surprise.


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LESSON 8

Close to one-fifth of the burden of disease in

developing countries can be attributed to

environmental risks. Much of this falls on our

children, as about two-fifths of infant mortality

is associated with environmental factors.5Looking closer at the major environmental

risks, about 1.7 million premature deaths are

attributable to unsafe water, poor sanitation,

and poor hygiene. As many as one-third of

these occur in Africa. Urban air pollution is10estimated to result in about 800,000 premature

deaths annually, and many developing

countries are rapidly urbanizing. But most

poor people still live in rural areas, where

traditional fuels from biomass and coal are the15main sources of energy.

Indoor air pollution from solid fuels is

estimated to inflict an even greater burden of

disease than outdoor air pollution does.

Against this backdrop, Environment Matters20focuses this year on the strong links between

environment and health.

There is also a direct connection to economic

growth: without a healthy, productive labor

force, we will not have the economic growth25

that is necessary to ensure a pathway out of

poverty.

There is emerging evidence that climate

change is also contributing to the burden of

disease in poor countries: more frequent and30intense droughts and floods; extension of

habitats for disease vectors (spreading malaria

and dengue fever, for example); expanding

areas where plants and livestock are impacted

by pests and pathogens; lower yields of some35agricultural crops (in turn impacting nutrition);

Stalinization of coastal areas , including

freshwater supplies resulting from sea level

rise; and so on.

40


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In 2000, more than 150,000 premature deaths

were attributed to various climate change45impacts, according to the World Health

Organization. Behind the statistics are scores

of human tragedies. Young lives are cut short,

and productive lives are hampered by frequent

and often painful disease. These are daunting50challenges, but

Environment Matters provides many inspiring

examples of ways we can successfully meet

them.

Achieving substantive progress in delivering55clean water, improved sanitation, cleaner air,

and a safer environment to millions of poor people will be the result of concerted efforts

involving governments, communities, civil

society organizations, the private sector, and60donors.

It is time for action. The Worlds political

leaders have reaffirmed their collective

commitment to achieving the Millennium

Development Goals. Further, the July200565Summit of the G-8 countries heightened the

industrialized countries support to

environmentally sustainable development for

the benefit of the Worlds poor. The

Millennium Ecosystem Assessment has70contributed to raise international awareness

and to strengthen the global commitment to

foster a healthy environment for this and futuregenerations.

www. krepublishers.com75


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EXERCISES

1. Match each word on the left with word on the right side. The

text will help you. Then use each expression in sentences below:

1. environmental A deaths

2. premature B short

3. strong C development

4. cut D factors

5. sustainable E links

1. About two-fifths of deaths in infants is connected with _______________.

2. Almost 2 million _________________are a consequence of unsafe water or bad sanitation.

3. Environment Matters has its eye sight set this year on the ______________between

environment and health.

4. Many young lives are ____________, and productive lives are hampered by frequent and

often painful disease.5. The July2005 Summit of the G- 8 countries heightened the industrialized countries support to

environmentally ________________ for the benefit of the Worlds poor.

2. Answer the following questions:

1. In which countries close to one-fifth of the burden of disease can be attributed to

environmental risks?

2. What can we attribute about 1.7 million premature deaths to?

3. Where do the poorest people live and what are their main sources of energy?

4. What can we consider as a pathway out of poverty?

5. What has the Millennium Ecosystem Assessment contributed to?


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3. Complete the following sentences by putting the verbs in

brackets in the correct form:

1. A great deal of this burden___________ ( to fall ) on the next generation.2. Air pollution in cities______________ ( to estimate ) to cause about 800,000 premature

deaths.

3. Evidence is popping up that climate change _____________ ( to contribute ) to the burden of

disease in the Third world countries.

4. According to data in the year 2000., more than 150,000 premature deaths _______________

( to attribute ) to various climate change impacts.

5. The political leaders of the developed countries___________________ ( to reaffirm ) their

collective goal of achieving the Millennium Development Goals.

4. Match the verbs with their correct definitions:

1. stop by A to return to somewhere that you have visited earlier

2. stop up B to remain somewhere at the end of an invent after other

people have left

3. stop back C to make a short visit to somebody /somewhere

4. stop out D to stay at home rather than go out

5. stop behind E to not go to bed until later than usual

6. stop in F to stay out late at night or all night instead of going

home


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5. Put each of following words or phrases in its correct place

below.

sewage enlightened pesticides sustainable

organic acid rain ecological deforestation

disposal herbicides extinction animal ri ghts

When industrialisation began, little thought was given to its (a) ________ effects. Raw, untreated

(b) _________ was allowed to pollute our seas and rivers. Animals were killed for profit to the

point of (c) ________. The loss of trees through uncontrolled (d) ________ caused erosion and

unstable climate. (e) _______ was caused by the poisonous gases man sent into the atmosphere.

Chemicals in (f) ________ killed animal life. (g) ________ destroyed plants. The balance of

nature was disturbed.

It is only now that we are waking up to the problem. More natural, (h) __________ farming is

advocated. Legislation controls the (i) ________ of waste products into our air and water.

Wildlife organizations are becoming more militant in their fight for (j) ________. Replanting

policies in some parts of the world mean that our forests should in the future be (k) _________.

We can only hope that growing public awareness and (l) _________ legislation will produce aworld which is safe for us and will provide a good quality of life for future generations.

6. Discussion:

1. Can environmental factors influence our health?

2. What do you think about the environment that we are living in?

3. What are the results of people being careless to the environment?

4. What can we do to make things better?


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LESSON 9

When a series of explosions tore through an oil

depot in Hertfordshire, flames reaching into

the sky were seen from miles away.Hertfordshire's Chief Fire Officer Roy Wilsher

said:"The damage a fire of this intensity will5cause may, or may not, leave clues for the fire

investigation team."

"This is possibly the largest incident of its kind

in peacetime Europe."

Samples of smoke are being taken to10

determine the long-term effects of exposure, ifany, according to Dr Jane Halpin, director of

Hertfordshire Public Health. People with

existing chest complaints are most at risk,

along with those who breathed in large15quantities of smoke. About 2,000 people living

near the site were evacuated, but some have

been able to move back in. Others have been

advised to keep their windows and doors shut.

One person admitted to Watford General20Hospital in intensive care with respiratory

problems has been stabilised. Another person

in Hemel Hempstead Hospital was being kept

under observation. Most of the other people

treated suffered minor injuries and were25

discharged. A security worker at the depot,

Troy Woodland, said: "I sat down and all of a

sudden there was a huge orange light and amassive explosion which blew the doors

through and knocked me off my chair, and the30ceiling fell in." Police officers including anti-

terrorist detectives are investigating, but say

there is "nothing to suggest" the fire was

anything other than an accident. Deputy Prime

Minister John Prescott visited the scene of the35 blasts as survivors told of their escape.

Tanker driver Paul Turner said he ran for his

life after the explosion lifted him off his feet.

"I just saw this great big ball of fire come up

from behind the building. It was about 5040meters wide," he told the BBC. "Then there

was the loudest explosion I have ever heard in

my life. I got up, turned around and ran to my

car and sped out of there as fast as I could."

Many houses have been damaged, with some45reporting feeling effects from the explosion as

far away as Oxfordshire- while the initial bang

was heard as far away as the Netherlands.

The Buncefield depot is a major distribution

terminal operated by Total and part-owned by50


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Texaco, storing oil, petrol as well as kerosene

which supplies airports across the region,

including Heathrow and Luton.

Around 50 families had asked the council for

overnight accommodation and are being put up55in bed and breakfasts.

Two of the residents now in the leisure centre

are Dominic and Sheila Gizzie, who live only

a quarter of a mile from the blast site."We got

woken up this morning with a huge60explosion", said Mr. Gizzie. "We have a lot of

damage, our fireplace was blown out, several

doors came off and the garage door has

broken. The flames were 100ft into the air, I

have never seen anything so big."65

Helen Glass, from Leverstock Green, was

sheltering at Jarmans Park with her two

children Megan, nine, and William, six. "There

was just a massive explosion and a long

rumbling sound at first I thought it was a gas70explosion or that a plane had crashed," said the

26- year-old.

French-owned Total is the world's fourth

largest oil company. Texaco is part of US

group Chevron, the fifth biggest.75

"We are doing everything we can to support

the emergency services and to bring the

situation under control," said a Total

spokesman.

Firefighters worked to contain the fire, using a80"curtain of water" between the flames and the

remaining unexploded fuel tanks. Seven out of

more than 20 tanks remained intact. Each was

said to hold three million gallons of fuel.

Marketing News 85


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EXERCISES

1. Complete the following sentences with appropriate words:

1. They ________out of town on their motorbikes.

2. Law enforcement officers are still searching for _______ in their search for the cause of

that accident.

3. Only a short __________ to radiation is very dangerous.

4. Patients were ___________ from hospital because the beds were needed by other people.

5. A _________________ is a building containing a swimming pool and a large room or

other places where you can play sports.

6. A chimney above the _________ allows smoke to escape through the roof.

7. People went to the doctor complaining of _________ pains.

8. It's isnt easy to come back from such a scandal with your reputation still __________.

2. Match the verbs with their correct definitions:

1. knock up A To cost someone a large amount of money 2. knock out B To destroy and remove

3. knock back C To stop working or doing something 4. knock off D To hit (someone) so that they become unconscious,

or (of a drug) to cause (someone) to go to sleep 5. knock down E To wake (someone) up, by knocking on the door of their

house or bedroom

discharged leisur e centr e clues tore

fireplace exposur e intact chest


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3. Put the verbs in correct form:

1. First ____________ ( to open ) in the 60s, Total -Texaco facility __________ (employ)

16 workers and is the fifth largest such depot in Great Britain.

2. It __________ ( to handle ) some 2,37 million metric tones of petrol and other oil products

a year, __________ ( fill ) 400 tanker lorries per day.

3. The pipeline from the Lindsey Oil Refinery on Humberside _____________( to complete

in 1990.

4. A further pipeline then ___________ ( to continue ) directly from Buncefield carrying

aviation fuel to Heathrow.

5. Evidences that could explain how the explosions __________ ( to happen ) may

___________ ( be ) destroyed by the fire.6. A special kind of crane ___________ ( be ) brought in to help with the operation.

4. Answer the following questions:

1. What happened when a series of explosions tore through an oil depot in Hertfordshire? 2. What happened with people living near the site? 3. How did a security worker describe the situation? 4. What some people said about the damage?


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5. Put each of following adjectives in its correct place in thesentences

blun t scratched smeared shabby

torn shop-soil ed fi lthy soil ed

rusty stained smudged faded

1. He was very angry when he saw that his new car was _______. Another car must have run

along the side of it.

2. The curtains were bright red when we bought them, but theyve become _________ in the

strong sunlight

3. That jacket needs cleaning and its rather old. I think its too _______ to wear.

4. If you need a banknote which is ________ in two, take it to a bank and exchange it for a

new one.

5. Buy our new design Travelbag. The different compartments will enable the traveller to

keep clean and _______ garments separate.

6. When she was two years old, she used to experiment with her mothers lipstick. Her face

was always _______ with it.7. See those red- brown bits? Thats where machine is beginning to go _______ because its

unprotected from the rain.

8. You can see the ceiling is ______ where the rain came through.

9. This radio is a bit _______ after being in the shop for nine months, so Ill knock 10 of f

the price.

10. Let the ink dry before you put another piece of paper on top of it. Otherwise itll be

_______.11. The knife isnt sharp, its _______. Give me another one.

This shirt isnt just dirty, Bobby. Its absolutely ________!12.


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6. Using the words from the list at the top of the exerciseabove, say what kind of damage or wear the following items cansuffer.

a photograph a book a car in an accidenta coat a razor-blade a car after long use

a television set a piece of furniture

7. Discussion:

1. What do you think are the long-term consequences of this disaster? 2. What should governments do in order to prevent that something like this happen?


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LESSON 10

A s e t tl ement be tween tw o o ld r iva l s m ay have grea t s ign i f icance

SOMETIMES a seemingly modest business deal

can change the course of an industry. This is

particularly true in high tech. In 1980, IBM

licensed an obscure piece of software known as

DOS from an unknown start-up called Microsoft 5thus creating the conditions for Bill Gates to build

the world /s largest software firm. Will a settlement

announced on May 29th between Microsoft and

AOL Time Warner, a huge media conglomerate,

one day be seen as the birth of another10Microsoft killer application: the platform for

delivering music, video and other digital content?

Given recent shifts in strategy by both firms, it15is no surprise that the old rivals have buried the

hatchet. Gone are AOL /s bubbly ambitions to be a

force in technology. Its online service is hurting, and

most of AOL /s former executives have stepped aside.

Netscape, an Internet pioneer which AOL bought in201998, may be scrapped altogether. Microsoft, for its

part, is focusing more on the software business after

many loss making forays into the media world.


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AOL will collect $750m to settle a private

antitrust suit it had brought against Microsoft for25abusing its Windows monopoly in its fight with

Netscape. This is much less than AOL Time

Warner /

s lawyers had expected when they filed suitin January 2002, but nothing to sneeze at for a firm

that is struggling to pay down debt of over $2530 billion. Also, Microsoft will give AOL a royalty

free licence to its Explorer web browser for seven

years, early access to new versions of Windows,

and help in distributing software for AOL /s online

service (which has been losing subscribers lately).35Yet the long run winner may well be

Microsoft. AOL has pledged to explore ways to

allow its instant messaging (IM) services to operate

with Microsoft /s own IM offering probably

solving a long term dispute between the firms.40Moreover, Microsoft has rid itself cheaply of a

legal headache and can now focus on the two

important outstanding antitrust cases against it. Sun

Microsystems, Microsoft /s other rich rival, has also

filed a private antitrust suit, which will most likely45take more than cash to settle. And European

trustbusters have yet to issue a ruling in their

investigation of the software giant.

But the settlement /s most important aspects

are not about Microsoft /s past efforts to control the50web browser market, but rather its future plans in

digital media. The deal turns AOL into a

potentially powerful ally for spreading Microsoft

software for distributing music and video. AOLwill get a long term licence to use this55technology. It will also work with Microsoft to

solve a huge digital dilemma: how to deliver

content online in a way that makes piracy hard, but

does not put off consumers.

60Given their technical expertise and market clout,

both firms could indeed develop such solutions and

deploy them widely, thus giving consumers more

ways to obtain high quality content legally. But

there is also a danger: that the co operation with65AOL puts Microsoft on course to control the software

infrastructure for delivery of digital content. Because

of strong network effects, this market (just like PCoperating system) is likely in the end to be dominated

by a single vendor.70

To be sure, Microsoft now lags behind

competitors in digital media technology, notably

RealNetworks and Apple, which recently launched,

with its iTunes Music Store, the first online music75service that appears to satisfy both content providers

and consumers. The firm has sold 3m songs for 99

cents each since it launched the service on April 29th.

Also, AOL says that its licence from Microsoft is non

exclusive and that it will still use rival technologies80(although many investors have doubts shares in

RealNetworks fell by over 10% after the settlement

was announced).

The impact on the agreement will indeed

depend on which digital media technologies AOL85decides to use. Unfortunately, the details of the

settlement are being kept confidential. Microsoft /s

competitors can only hope that AOL has thought that

all eventualities as IBM did not with DOS.

90The Econ


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EXERCISES

1. After reading the text answer these questions:

1. On what is Microsoft focusing?

2. Did AOL Time Warner expect to collect $750m?

3. What are the settlement /s most important aspects?

4. What is the danger in co operation with AOL?

5. In what does Microsoft now lag behind?

2. Decide whether the following statements are true (T) or false

(F):

1. In 1980, IBM licensed an obscure piece of hardware. T F

2. Netscape may be scrapped altogether. T F

3. Microsoft won /t give AOL a royalty free licence to

its Explorer web browser. T F

4. Sun Microsystems is not Microsoft /s rich rival. T F

5. The impact on the agreement will depend on which

digital media technologies AOL decides to use. T F

3. Fill the gaps with the words from the text:

1. AOL will collect $750m to ____________ a private antitrust suit it had ______________

against Microsoft for abusing its Windows monopoly in its fight with Netscape.

2. This is much less than AOL Time Warner /s lawyers had _____________ when they filed

suit in January 2002, but nothing to sneeze at for a firm that is struggling to pay down

debt of over $25 billion. Sun Microsystems, Microsoft /s other rich rival, has also filed a

private ______________ , which will most likely take more than cash to settle.


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3. And European ______________ have yet to issue a ruling in their investigation of

the_______________.

4. Given their technical expertise and market clout, both firms could indeed _____________

such solutions and deploy them widely, thus giving consumers more ways to

_____________ high quality content legally.

5. The firm has sold 3m songs for 99 cents each since it ________________the service on

April 29th.

4. What are the benefits that the co operation between AOL

and Microsoft would bring?

5. Phrasal verbs and nouns with turnturn into (line 74)

A) Match the following verbs and nouns with the correct definitions

1. turn up A do something in a agreed order

2. turn down B the amount of sales in a certain period of time

3. turn over C do business or sell goods worth a certain amount

4. turn round D make a business profitable again after it has had losses

5. turn out E a point in time when an important change takes place

6. turn against F the number of workers employed to replace those who

have left

7. take turns G produce

8. turning point H refuse, reject

9. turnover I change ones attitude and become hostile

10. turnover J arrive, appear


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B) Complete the following passages with words from the list above.

1 I work for a kitchen appliance manufacturer . Were a fairly large organisation. Our

.. (1) is over 20m annually, and Id say we (2) roughly 2,000

units a month. Were profitable now but we had a difficult time in the ear ly 1980s. We almost

went bankrupt. The .. (3) was when we got a new Chief Executive. Within two

years, he completely (4) the company. Now were doing well. Our only

problem is that our labour (5) is rather high well above average for the

industry.

2 Im meant to start work at 8.30 a.m. but I often (1) late. On Fridays,

someone in the office has to work until 10 p.m. We usually . (2) its fairer that

way. I quite like my job and I dont want any more responsibility. In fact, Ive already

.. (3) two offers of promotion, much to my bosss annoyance. I hope he doesnt

(4) me because Ive refused opportunities for promotion. By the way, my firm

(5) about 200,000 a month.

6. Put each of the following words or phrases in its correct place in the

sentences below.

numismatist standing order currency expenditure

counterf oil counterf eit statement bounce

legal tender

1. You can change your ________ at my bank.

2. She held the note up to the light to make sure it wasnt ________.

3. She collects coins and banknotes. Hes a ________.

4. I always fill in the ________ when I write out cheque. Otherwise I would lose track of my

_______.

5. I dont trust him. Im sure his cheque will ________.

6. I pay my rent by ________. It saves me having to write a cheque every month.

7. The bank sends me a detailed ________ every month.

8. Dont worry. Scottish banknotes are ________ in England too.


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LESSON 11

It is probably the case that of everyone

who reads this review the vast majority will have at

some time or another signed up to a loyalty-

marketing program. Be it air miles, credit card

reward points, money-off vouchers or luxury gifts,5most of us are collecting for something whenever

we shop. In the UK, for example, thousands of us

think nothing of handing over our Nectar card when

we shop at Sainsbury`s.

But as customers, how often do we10actually cash this points in? How often do we feel

really excited by what is on offer? Most

importantly, how often do we feel our loyalties to

these stores increases? Does not everyone offer a

card these days? Are we not, in fact just bored of15them?

When the first loyalty cards hit the

market, uptake was huge and rewards for

marketers very

high. Not only20could a company

help ensure acustomer came

back to them

over their25competition, but

with the

increased spend came a series of valuable data

which refined their knowledge of who they were

trying to sell to.30

Consumers are evermore difficult to

please, and uptake on offers is reducing. In the US

the rate of membership growth slowed from 30

percent in 2000 to 4 percent in 2003, and on

average only a quarter of members redeems their35 promotional currency.

Watching this downward trend, marketersfear the loyalty-card is on its way out.

One repeated suggestion is that customer

uptake is diminishing because the technology40involved is becoming too complicated. Although

advanced means of collecting data can be highly

useful from the company`s point of view, if this

technology becomes central to the added value

offered to the customers than it is unlikely they will45respond well.

Yet in "Loyalty-marketing for the twenty-

first century" Capizzi and Ferguson argue that this

loyalty-marketing that takes advantage of current

technology still has a lot to offer if only marketers50thought a little harder about how they put the

program into practice. Customers are now well-

versed in what these schemes are about, and there is

a lot of market for them to choose from. However,loyalty-cards will continue to work well, provided55that the value proposition is attractive enough.

This is the crux of Capizzi and Ferguson`s

argument. Their belief is that imagination is now

central to the ongoing success of this strategy. As

consumers we are tiring of offers that ask us to60collect points in exchange for money off vouchers,

standard gift tokens and uninspiring "toaster" - style

presents. This is no doubt that this is one of the

reasons why the rate of uptake of these programs


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has slowed so much - customers are simply failing65to see the added benefit as enticing enough to keep

them going back to the same store.

What is lacking is what Capizzi and

Ferguson label the Wow! Factor, which in mostcases means the offer of a reward with more soft70

benefits. This could be an otherwise unobtainable

experience, such as Harrods of Londons day with a

top jewelry designer. For the wealthier customer,

whose disposable

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