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Transcript of Cars
...across the country McQueen’s engine failed and he and his team became stranded at Radiator Springs, Arizona.
Once a prosperous town, it
suffered greatly due
In the small town...
He had plenty of supplies...
...and knowledge of what he was doing, but after McQueen looked around the town he realized that the town was deserted.
...for the new auto parts and the high quality service that Luigi provided. McQueen thought to pay Luigi back by making Luigi his main sponsor.
By Harry Chang, Nikita Polozov, John So, Trevor Johnson
Once upon a time...
Lightning McQueen was on a journey to become the best NASCAR driver to ever live, and to do that he had to win the most famous of all NASCAR races,
the Daytona 500.
But before he could do that he had to travel across the country in an epic road trip that would prove to be the most adventurous of his life!
After coming to terms that he wouldn’t make it to Daytona on time he made multiple calls to relocate the race in Radiator Springs.
... of Radiator Springs McQueen found a local mechanic named Luigi. At Luigi’s Auto Shop, he was fixed up and ready for racing.
In the back of McQueen’s mind he wondered how a fine mechanic such as Luigi had trouble pulling in customers.
Besides the handful of store owners McQueen and his team were the only outsiders.
At first Luigi was hesitant because being a sponsor meant that he had to pay a great amount of money.
In the beginning...
... Luigi would have to pay more because of the high nominal interest rate. But due to the increase of investment the rate would decrease.
Later down the line Luigi would be making more money due to the influx of customers at his shop.
Since the Daytona 500...
...was moved to Radiator Springs the town saw an influx of tourists. Because of all the tourists who had come to see the race the town of Radiator Springs saw an increase in the aggregate demand of its goods and services.
This change in the demand saw the prices in the town skyrocket overnight!
Luigi was excited...
... to invest in Lightning McQueen but did not have the money he needed to sponsor Lightning. Luigi decided to take out a loan in order purchase all the supplies that Lightning would need to be successful in the Daytona 500.
Luigi’s loan caused a decrease in supply in the loanable funds market. Now with the loan that Luigi received from the bank he could invest in Lightning and eventually make a profit on his investment.
Talking about the future...
...of NASCAR industry, McQueen convinces Luigi to reallocate the resources that go into auto parts to tires. McQueen tells Luigi that tires are more profitable than auto parts due to multiple pit stops in a single race.
Hearing the words more profit, Luigi was instantly in for the idea.
Now with more profit...
...Luigi decides to invest in capital in order to grow his business. With the recent increase in demand of his products it surely will end up being a good decision in the long run.
By investing in capital he can produce more goods after a period of a year or more!
In the end...
... the town became a holy site for NASCAR fans as it replaced the Daytona 500 with
Radiator Springs 501
. The town grew prosperous.
Racing enthusiasts are seen year round in Radiator Springs now. Due to Lightning McQueen the town was brought out of recession and pushed to its full employment output.