Confused Words: Economics vs. Finance

hi welcome to right to top I'm Adam in today's video I want to talk about vocabulary and more specifically about the words economy and Finance now the reason I picked these words is because in my experience many of you mix up these two words one with the other or the different forms of these words let's look at some of these forms economics economy economic economical economize finance finances financing and financial now whether you're mixing the two words together like account economics and finance or you're misusing the different forms of these words because economical and economic are both adjectives but they have very different meanings and uses so it's very important to know the meanings of each of these words and how to use them in context so I'm going to show you the definitions and I'm going to show you some sample sentences hopefully this will clear it up and you'll be able to use them correctly especially for those of you doing tests like IELTS would you have the task 1 sometimes it's a business situation you have to look at or for example any test that has an essay question that deals with economy or government or even education where spending is involved and money is involved etc or the TOEIC exam which is business-related you need to know the difference between these words so let's get started we'll go one by one hopefully this will help you out a little bit ok so let's start with economics first of all you have to remember that economics with the S is still a singular noun ok it's a collective noun you could call it or just an idea especially when we were talking about a subject in school so just like news when you talk about news in a newspaper or on TV although it has the S it's still a singular noun same with economics so you study economics ok or it's just a general abstract idea of production distribution consumption of goods services trade imports exports all of these things that have to do with money of a region we'll talk about in a second that is economics so as a subject in school studies economics at school now notice that I have a small e not a capital e this depends on the style guide you're using but for the exams use the small letter you don't worry about the capital depends on the style guide you're using when you're writing other things now we can also talk about economics when we're talking generally about things that have to do with money we're not talking about money itself not the money you hold in your hand or the money you have in the bank it's financial considerations and I know I'm using the word financial here we'll talk about that separately but when we're talking about economics we're talking about the money situation of an action or an event or a situation okay and it is still a plural in this case so financial considerations we don't usually have one consideration when we're talking about economics we have many considerations so the government's expansionist aims simply do not align with the economics of today's military infrastructure so the government wants to expand its reach it wants to maybe go to different countries and take over or maybe change governments or something like that but the gut the military infrastructure what the military is built up to do there's just not enough money to do what the government aims to do in terms of expansion so the economics don't align don't match with the plans okay so you have the plans you have the reality of the infrastructure and they don't agree in terms of the economics of the situation okay so let's move on to economy now there's no s here just economy we're talking about the economy or economy we're gonna look at both of them so here's the first noun definition it's the structure or condition of a country or region and areas wealth it's a weak economy a strong economy an emerging economy developed economy shrinking growing etc so all kinds of adjectives you can use with economy but when we talk about the economy we're talking about the general structure of how money is made we're talking about GDP GNP we're talking about imports of exports we're talking about trade deficits and surpluses all of these things that involve a whole region okay so when you talk about your country's economy if your country has a strong economy it means people have jobs it means the government has money to spend on bridges and roads and schools and hospitals if you have a weak economy it means that you're borrowing money from other countries or you need to sell your products cheap to export them cheap in order to bring in revenues so all of these things that together work to make the wealth of a nation or a region we call the economy the public wants to hear the candidates discuss the economy and how they will create jobs not rhetoric about foreign policy so during an election time you hear all these politicians all yeah I'm gonna fix the economy I'm gonna fix the economy I'm gonna fix the economy but they don't tell you how they're gonna do it they're not gonna tell you they don't talk about jobs they don't talk about investments they don't talk about capital investments or expenditures etc so people want to hear about the economy they want to know how their lives will be easier financially I'm going to look at financially in a moment now we can also use economy without the sometimes you can use it with that depends on the context but it's not the economy it's not a it's not an abstract idea it's a careful use of resources it means how you use what you have in terms of resources now it doesn't have to be money it could be time it could be space it could be actual resources like things like wood or metals or minerals or oil these are all the resources and how you use them okay so we're talking here we're going to talk about a design of a condominium the design of the condo takes economy of space into account it provides ample comfort so what does this mean so the designer the architect or the interior designer took the space that was available to him or her and with that space he made as much use of the place to put in furniture put in a kitchen a bathroom a bedroom etc he used all the space available to him as best and as efficiently as possible get the most out of it so he carefully used his resource of space okay so he took economy of space into consideration now economy can also be an adjective and it means a little bit cheaper okay or something a little bit more efficient we're talking about economy seat for example on an airplane economy car an economy ticket on a train or an airplane etc Jeff gave up on the idea of an SUV and bought an economy car instead to save some money on gas an SUV big car uses a lot of gas an economy car like small Toyota or Honda or whatever it's smaller it's lighter it uses less gas it's more efficient so it's an economy car okay okay so it's also very important to notice we have two different meanings of the word economy and we have an adjective for the word economy so be careful on how you use them the second now the careful use of resources less commonly used but still you need to know it now economic when we talk about economic with it's an adjective and it's relating to the economy or to economics to personal wealth to social wealth etc basically to wealth an economy investors should not doubt the economic health of the company in fact we forecast unprecedented growth this year and next so when we're talking about the health of the company's economy how the company makes manages controls money okay all the things that are involved in terms of labor costs in terms of production costs in terms of revenues taxes all of this is part of the economy even the electricity bills the lights etc it's all part of the economy of the company and economic health is how well or not well the company's economy is doing or the company's economics are contrary to popular opinion the government's decision to reduce its aid contribution to the UN is not politically motivated but based solely on economic reasons so their reasons are economic meaning that it has to do their economics their economy their economy or whatever the costs of dealing with the UN whatever those may be most middle-class families make economic decisions based on their children's need first so economic decisions meaning how are they going to spend their money where they're gonna go on vacation what kind of car they're gonna buy where they're gonna send their kids to school what job to take what job to reject all of these things are economic decisions based on the cut the household or the family's economics okay let's move on economical is very different from economic and this is where a lot of people make a mistake they use economic when they mean to say economical economical means less wasteful it's more efficient use of money thrifty Bill and Linda plan to drive to Vancouver this summer but with the gas prices being as high as they are it is actually more economical to fly means it makes more financial sense it's it makes more money sense basically it's cheaper to put it simply it is more economical to cook and eat at home than to regularly eat at restaurants restaurants are expensive going shopping and cooking at home much cheaper small cars are much more economical than large SUVs we mentioned before but many people nevertheless purchase the gas guzzlers as a status symbol so the small car is more efficient in terms of how much gas it uses and because it's more efficient it obviously works out to be cheaper okay gas guzzlers means ghazal means drink a lot so a gas guzzler is a car that uses a lot of gas it's good a little slang to know that okay so now we're going to look at economize which is the verb of economy to economize basically means to spend less or reduce costs essentially to save money okay so many companies are now shifting to automated production so as to economize on labor costs to economy economize on labor cost basically means to reduce labor costs to save money one of the first things students learn to do in school is to economize because they have no time to work and limited funds for spending on food and going out so students go away to school their parents give them allowance or they saved money from working and are basically paying for themselves so they learned to economize they learned to spend less to get what they need because they don't have that much so a little money has to go a long way so instead of buying the brand name : own name brand because it's cheaper okay so they economize on certain things let's look at finance so like economics finance no s singular is a subject of study at school so Janice is majoring in finance at university here I put finance with a capital just to show you that both are okay for the IELTS TOEFL etc just use the small F the small e for small letter for any subject except a language English is still English still capital e but so when you study finance economics you're studying abstract ideas the system of a place finance you're studying more practical things more specific things like accounting you're talking about corporate finance personal finance investments commerce okay so these are more specific handling of money how to handle money how to make balanced budgets assets liabilities etc when you're talking about finances with an S okay even though it's generates that it's technically a plural but we can use it as a singular again it's money to be used saved managed by a person group or company so finances are the actual money what are you gonna do are you going to control our finances our finances basically means our money but like money is an uncountable finances is also uncountable and can be used as a singular or plural after bleeding money for three consecutive quarters the Board of Directors finally decided to bring in a more qualified CFO chief financial officer to manage the company's finances so the company's been losing a lot of money they bring in somebody new to manage the finances to manage the company's money to make sure they're not losing money not bleeding money out of the company financial adjectives so this has to do with money matters when you're talking about money things with bills promotion and thus his improved financial situation means he has more money the family decided to change their vacation plans and go to Disneyworld so before they were gonna go visit his grandparents in Florida now they have enough money to go to a nicer resort like Disneyworld and have a much nicer vacation because his financial situation is basically his money situation has improved when you talk about financial we always we have collocations we use financial situations of financial disaster financial problem financial advice financial risk/reward institution year aid commitment a lot of things that are financial a financial institution for example is a bank mostly there are other financial institutions a person in the US who does not have health insurance is not only risking his health he is also risking financial ruin means if you get sick in the US and you don't have insurance health care is so expensive that you can be financially ruined you can go bankrupt have no more money after you pay all your medical bills okay to finance - finance means is the verb first of all is the verb of finance it means to supply with money to finance something means to pay for somehow to give some monetary support for something supply with money funds capital in terms of business or to pay for something in installments like a loan so the first one as the school would not cover their trip to the basketball finals the team decided to hold a bake sale and raise the funds to finance their trip so the team was able to get into the finals but the finals is in a different City now to get to the finals they need buses they need a hotel maybe to spend the night they need all kinds of things that cost money the school would not pay for it but the team still wanted to go obviously they're very proud of themselves so they did they had a bake sale they sold cookies and pies and whatever and the money that they made from this sale they used to finance their trip means they used to pay used it to pay for their trip on the other hand to pay for something means to get a loan basically if you want to buy a card it's $40,000 and you don't have this kind of money right away you can put down a down payment to $3,000 and then each month you will pay back that loan you will finance the car over four or five six years as long as it takes to pay it all back these days most people do not buy their car outright but rather finance it over a four to six year term okay and lastly we have financing financing is basically the noun situation of to finance it is to get money or to provide money pay the costs of something so that somebody has the monetary support due to his bad credit history Kevin could not secure the financing he needed to open his shop so to open his shop he needed a lot of money he went to the bank to get the financing to get the money to pay for all this the loan in this case but he has bad credit they wouldn't give it to him he doesn't have the money to open his business okay so there you have it economics finances and all the related forms etc the best thing you can do for practice now is use all of these different forms all of these different words in sentences make sure you're using them correctly and again remember if you're not a hundred percent sure how to use a word don't use that word look for a synonym look for another way to express that idea that it comes across clearly better not to use a word incorrectly than to use a simpler word if one is available if you want to put your sample sentences below here in YouTube or Facebook Twitter Instagram any of my social pages I'll be happy to give you some tips on them you can also help each other check each other's sentences make sure they're correct if you have any questions of course please ask as well here or the other pages subscribe to my channel if you liked it if you like this video give me a thumbs up if you like all my videos well if you like this video please give me a like and don't forget to subscribe to my channel there'll be lots more videos coming grammar writing test tips etc more vocabulary lessons of course and I'll see you again real soon bye-bye

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Keywords: ielts, English writing, English, writing, language test, English test, task 2, IELTS academic essay, vocabulary, structure, word choice, writetotop.com, TOEFL, independent task, independent essay, how to write, essay writing, usage, skills, test preparation, test tips, study tips, pass the IELTS, synonyms, conclusion paragraph, ielts high score, toefl high score, pass toefl, Engvid Teacher Adam, TOEIC, CAE, lexical range, language skills, common errors, economics vs. finance

Id: xg0Hq0u5loE

Length: 17min 52sec (1072 seconds)

Published: Wed Jan 25 2017