1. A Little Math © Allen C Goodman, 2005

2. Graphing Let’s return to the Production Possibility Curve that we saw before How did we get it?

3. Figure 2 The Production Possibilities Frontier Copyright©2003 Southwestern/Thomson Learning Production possibilities frontier D C Quantity of Cars Produced 2,200 600 0 700 2,000 3,000 1,000 Quantity of Computers Produced ComputersCars 3000 0 2500 300 2200 600 2000 700 1000 850 01000 A B E F 2,500 1,000 300850

4. Figure 2 The Production Possibilities Frontier Copyright©2003 Southwestern/Thomson Learning If you are at point C, what is the cost of another 100 cars? To get +100 cars, you must take -200 computers! Production possibilities frontier D C Quantity of Cars Produced 2,200 600 0 700 2,000 3,000 1,000 Quantity of Computers Produced A B E F 2,500 1,000 300850 -200 +100 Slope = “rise”/”run”

5. Figure 2 The Production Possibilities Frontier Copyright©2003 Southwestern/Thomson Learning If you are at point C, what is the cost of another 100 cars? To get +100 cars, you must take -200 computers! Production possibilities frontier D C Quantity of Cars Produced 2,200 600 0 700 2,000 3,000 1,000 Quantity of Computers Produced A B E F 2,500 1,000 300850 -200 +100 Cost/car = -2 computers/car !

6. Another Example w/ Excel HoursScore xx yy Slope 18 317 526 836 938 1035 Let’s use an excel program, slope.xlsslope.xls

7. Key Points We will be graphing relationships. You should get comfortable with it. Whatever aides you need (EXCEL, graphing calculators, etc.) are fine with me, if they can help you to do the work.