GRAPHS AND THEIR MEANING APPENDIX 1A - 1Copyright McGraw-Hill/Irwin, 2002

INCOME (per week) $ $ CONSUMPTION (per week) Table of Values Construction of a Graph 1A - 2 BACK TERMS Copyright McGraw-Hill/Irwin, 2002

INCOME (per week) $ $ CONSUMPTION (per week) Table of Values Construction of a Graph 1A - 3 BACK TERMS CONSUMPTION (C) $ Vertical Axis Copyright McGraw-Hill/Irwin, 2002

INCOME (per week) $ $ CONSUMPTION (per week) Table of Values Construction of a Graph 1A - 4 BACK TERMS CONSUMPTION (C) INCOME (Y) $ Vertical Axis Horizontal Axis Copyright McGraw-Hill/Irwin, 2002

INCOME (per week) $ $ CONSUMPTION (per week) Exists Between Consumption & Income CONSUMPTION (C) INCOME (Y) $ a b c d e a b c d e C=50+.5Y A Direct Relationship... 1A - 5 BACK TERMS Copyright McGraw-Hill/Irwin, 2002

TICKET PRICE $ ATTENDANCE (thousands) An Inverse Relationship... Exists Between Ticket Prices & Attendance TICKET PRICE (P) ATTENDANCE IN THOUSANDS (Q) $ a b c d e a b c f e P=50-2.5Q f d 1A - 6 BACK TERMS Copyright McGraw-Hill/Irwin, 2002

Can you locate the Dependent and Independent Variables? Variable Dependency 1A - 7 BACK TERMS Copyright McGraw-Hill/Irwin, 2002

Slope of the Line is... Vertical Change Horizontal Change =.5 1A - 8 BACK TERMS INCOME (per week) $ $ CONSUMPTION (per week) CONSUMPTION (C) INCOME (Y) $ Positive Slope Copyright McGraw-Hill/Irwin, 2002

Slope of the Line is... Vertical Change Horizontal Change = A - 9 BACK TERMS Negative Slope TICKET PRICE $ ATTENDANCE (thousands) TICKET PRICE (P) ATTENDANCE IN THOUSANDS (Q) $ Copyright McGraw-Hill/Irwin, 2002

MEASUREMENT UNITS MARGINAL ANALYSIS INFINITE & ZERO SLOPES Slope of a Line 1A - 10 BACK TERMS Price of Bananas Purchases of Watches Consumption Divorce Rate Slope = Infinite Slope = Zero Copyright McGraw-Hill/Irwin, 2002

In Equation Form C = Y P = Q Slope of a Line 1A - 11 BACK TERMS y = a + bX Copyright McGraw-Hill/Irwin, 2002

Slope of a Curved Line is... The Slope of a Straight Line Drawn Just Tangent to the Curve B b b QP A a a 1A - 12 BACK TERMS Copyright McGraw-Hill/Irwin, 2002

Vertical & Horizontal Axes? 1A - 13 BACK TERMS Can You Identify... Copyright McGraw-Hill/Irwin, 2002

Vertical Intercept? 1A - 14 BACK TERMS Can You Identify... Copyright McGraw-Hill/Irwin, 2002

Slope of the Line? 1A - 15 BACK TERMS Can You Identify... Copyright McGraw-Hill/Irwin, 2002

Tangent? 1A - 16 BACK TERMS Can You Identify... Copyright McGraw-Hill/Irwin, 2002

Direct & Inverse Relationships? 1A - 17 BACK TERMS Can You Identify... Copyright McGraw-Hill/Irwin, 2002

1A - 18 BACK TERMS Copyright McGraw-Hill/Irwin, 2002

horizontal axis vertical axis direct relationship inverse relationship independent variable dependent variable slope of a straight line vertical intercept END SHOW Copyright McGraw-Hill/Irwin, 2002

THE ECONOMIZING PROBLEM CHAPTER 2 COMING SOON Copyright McGraw-Hill/Irwin, 2002