APPENDIX GRAPHS AND THEIR MEANING 1 A 1

APPENDIX GRAPHS AND THEIR MEANING 1 A - 1 Copyright Mc. Graw-Hill/Irwin, 2005

Construction of a Graph Table of Values INCOME (per week) CONSUMPTION (per week) $ 0 $ 50 100 200 150 300 200 400 250 BACK TERMS 1 A - 2 Copyright Mc. Graw-Hill/Irwin, 2005

Construction of a Graph Table of Values CONSUMPTION (per week) $ 0 $ 50 100 200 150 300 200 400 250 BACK TERMS 1 A - 3 $400 CONSUMPTION (C) INCOME (per week) 300 200 100 Copyright Mc. Graw-Hill/Irwin, 2005 Vertical Axis

Construction of a Graph Table of Values CONSUMPTION (per week) $ 0 $ 50 100 200 150 300 200 400 250 Vertical Axis $400 CONSUMPTION (C) INCOME (per week) 300 Horizontal Axis 200 100 0 BACK TERMS 1 A - 4 Copyright Mc. Graw-Hill/Irwin, 2005 100 200 300 INCOME (Y) 400

A Direct Relationship. . . Exists Between Consumption & Income INCOME (per week) CONSUMPTION (per week) $ 0 $ 50 100 b 200 150 c 300 200 d 400 250 e $400 C=50+. 5 Y CONSUMPTION (C) a 300 e 200 d c 100 b a 0 BACK TERMS 1 A - 5 Copyright Mc. Graw-Hill/Irwin, 2005 100 200 300 INCOME (Y) 400

An Inverse Relationship. . . Exists Between Ticket Prices & Attendance $ 50 40 30 20 10 0 BACK TERMS 1 A - 6 ATTENDANCE (thousands) 0 4 8 12 16 20 $50 a b c d e TICKET PRICE (P) TICKET PRICE 40 30 20 10 f Copyright Mc. Graw-Hill/Irwin, Inc. 2005 0 P=50 -2. 5 Q a b c d e f 4 8 12 16 20 ATTENDANCE IN THOUSANDS (Q)

Variable Dependency Can you locate the Dependent and Independent Variables? BACK TERMS 1 A - 7 Copyright Mc. Graw-Hill/Irwin, 2005

Slope of the Line is. . . CONSUMPTION (per week) $ 0 $ 50 100 200 150 300 200 400 250 Positive Slope 50 =. 5 100 $400 CONSUMPTION (C) INCOME (per week) Vertical Change Horizontal Change 300 200 100 0 BACK TERMS 1 A - 8 Copyright Mc. Graw-Hill/Irwin, 2005 100 200 300 INCOME (Y) 400

Slope of the Line is. . . $ 50 40 30 20 10 0 BACK TERMS 1 A - 9 ATTENDANCE (thousands) 0 4 8 12 16 20 Negative Slope -10 = -2. 5 +4 $50 TICKET PRICE (P) TICKET PRICE Vertical Change Horizontal Change 40 30 20 10 0 4 8 12 16 20 ATTENDANCE IN THOUSANDS (Q) Copyright Mc. Graw-Hill/Irwin, 2005

Slope of a Line Slope = Infinite Purchases of Watches BACK TERMS 1 A - 10 Copyright Mc. Graw-Hill/Irwin, 2005 Consumption Price of Bananas MEASUREMENT UNITS MARGINAL ANALYSIS INFINITE & ZERO SLOPES Slope = Zero Divorce Rate

Slope of a Line In Equation Form y = a + b. X C = 50 +. 5 Y P = 50 - 2. 5 Q BACK TERMS 1 A - 11 Copyright Mc. Graw-Hill/Irwin, 2005

Slope of a Nonlinear Curve. . . The Slope of a Straight Line Drawn Just Tangent to the Curve P 20 a A 15 10 5 b B 0 BACK TERMS 1 A - 12 5 a Copyright Mc. Graw-Hill/Irwin, 2005 10 15 b 20 Q

Can You Identify. . . Vertical & Horizontal Axes? BACK TERMS 1 A - 13 Copyright Mc. Graw-Hill/Irwin, 2005

Can You Identify. . . Vertical Intercept? BACK TERMS 1 A - 14 Copyright Mc. Graw-Hill/Irwin, 2005

Can You Identify. . . Slope of the Line? BACK TERMS 1 A - 15 Copyright Mc. Graw-Hill/Irwin, 2005

Can You Identify. . . Tangent? BACK TERMS 1 A - 16 Copyright Mc. Graw-Hill/Irwin, 2005

Can You Identify. . . Direct & Inverse Relationships? BACK TERMS 1 A - 17 Copyright Mc. Graw-Hill/Irwin, 2005

horizontal axis vertical axis direct relationship inverse relationship independent variable slope of a straight line vertical intercept END SHOW Copyright Mc. Graw-Hill/Irwin, 2005

CHAPTER 2 THE ECONOMIZING PROBLEM COMING SOON Copyright Mc. Graw-Hill/Irwin, 2005