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Principles of Economics & Monsters, Inc

Introduction

At first glance, Monsters, Inc is just an average animated children's movie. However, many parallels between this movie and the principles of economics can be drawn.

Background Information

  • The general premise of this movies is that there is a world of monsters and a world of humans - where monster world relies on human world for survival
  • The Monsters, Inc Corporation captures the screams of humans to use as a universal power source that the monsters use for things such as cars/homes/electronics

Major crisis takes place.

scream shortage because world is changing and kids are becoming desensitized to violence.

Simple example of an economic decision

Mike Wazowski wants to Drive his new car to work..

Sully interjects noooooo!

why?

Taking the car out costs energy (a scarce resource in the monster world) + it is not worth the benefit of getting to work quicker as well as enjoyment of the ride.

Mike decides to walk with sully because marginal benefits outweigh the single marginal cost of getting to work a few minutes later - but still on time!

This is an example of an economic decision because when in a recession or crisis, human behavior is affected and most people take on a conservatory mindset. Additionally, decisions and behavior come about because people unintentionally weigh their decisions using the concept of marginal costs/benefits.

In terms of Employment...

The monsters, Inc Corporation offers the title of "top Scarer" to each of its employees. This is a stimulus used by the company to get the most output from their workers.

New Job Applicants are not well educated nor are they trained to company's standards...

However, this did not result in structural unemployment because the company is forced to incur the costs of training new recruits.

What problem is causing such a disruption within the company?

The quantity of "scream" demanded was outweighing the quantity of "scream" supplied.

which equals....

a SHORTAGE!

Sully and Mike Do save the day with an innovation.

They discover that a child's laughter is more powerful than screams can ever be for their world.

This change in production technique shifts the supply curve to the right and brough the economy back to...

EQuilibrium!!!!!!!!!

The End.

hmmmm....

Mike decides to walk with sully because u

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