case study [Introduction to Business Administration] negotiating over the price of aCase study (practice)Opportunity International : Giving the Poor a Working ChanceBillions of people in the world make two dollars a day or less. In fact, a billion people make lessthan one dollar a day. In such places, a loan of $100 or $200 makes a huge difference. That'swhere microloans from organizations such as Opportunity International come in. OpportunityInternational is an organization that grants microloans to people, mostly women, in developingcountries so they can invest in a business. Those investments often lead to community growthand employment and help the owners, themselves, to prosper on a moderate scale. Theborrowers must pay back the money with interest-when they do, they can borrow more andkeep growing.Opportunity International, unlike some other microlending organizations, also provides abanking function where entrepreneurs can safely put their money. They can also buy someinsurance to protect themselves against loss. Opportunity International helps over a millionpeople in over 28 countries, giving them the opportunity to change their lives for the better.This video introduces you to some of those people but primarily explains how freedom and alittle money can combine to create huge differences in people's lives. Adam Smith was one ofthe first people to point out that wealth comes from freedom, the ability to own land, and theability to keep the profits from what you do on that land. When people try to maximize profits,they have to hire other people to help them do the work. This provides jobs for others andwealth for the entrepreneur. And, like an Invisible Hand, the whole community benefits fromthe entrepreneurs' desire to earn a profit.In the video, you can see a woman in Uganda who has applied those principles to benefit herfamily, provide employment, and help her community. And capitalism is the system wherepeople can own their own land and businesses and keep the profits they earn. Such a systemdemands that:(1) people can own their own property (not a reality in many developing nations);(2) keep the profits from any business they start;(3) compete with other businesses (it is difficult to compete with the government)(4) work wherever and whenever they want. The keyword in capitalism is freedom-freedomofan attempt to show people how freedom plus a few dollars can make a hugedifference in an economy. In a free-market economy, price is determined by buyers and sellersequilibrium point is the place where buyersthere isand what sellers need to produce. Thus, in commandno supply-and-demand mechanism in operation, there can bein food, clothing, and other necessities. Socialism and communism arealternatives to a free market economy. Under such systems, people are more likely to havebit of equality, but there are fewer incentives to work hard, and entrepreneurs are often luredto countries where they can make more money by working harder. The result is called a braindrain, where the best and the brightest often move to free-market countries. There areadvantages to socialism and communism, such as free schools, free health care, free daycare,good or service.Theandagree to exchange; it is also called the market price. Without free markets,no way of knowingwhatthere iseconomies, wherebuyers needshortages or surplusesetc.But the taxes are higher, and there is usually less innovation and higher unemployment. Thetrend in the world is toward mixed economies where most of the economy is based on free-market principles, but the government gets involved in things such as education, health care,and welfare. The United States has been basically a free market economy, but it is clear thatthere is a movement toward more government involvement. On the other hand, somecountries are reducing the role of government in society and moving toward freer markets.Thus the world is moving toward mixed economies. The United States government tries tocontrol the money supply through the Federal Reserve and fiscal policy.Fiscal policy has to do with taxes and spending. The less the government spends, the more thatis available for businesses to invest. And the lower the tax rates on entrepreneurs, the more they will invest in businesses and the faster the economy will grow. Opportunity Internationalshows the poorest of the poor how important entrepreneurs, freedom, opportunity, and a littlebit of money are to economic growth and prosperity. You are encouraged in this video toparticipate in helping poor people around the world. You can do this by contributing time andmoney to organizations like Opportunity International. You can join the Peace Corps or othergroups designed to assist less-developed countries.1/Why there is a need for organizations like Opportunity International ?2/How does the free market work? What are the advantages and disadvantages of freemarkets ?The Consumer send signals about what they like and how they like it then Price tells companies howmuch of a product they should produce and if If something is wanted but hard to get, the price will riseuntil more products are available.3/ Make a comparison of the key economic systems.

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The companies that work for the prosperity and development of the community to eliminate poverty and…

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