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Unformatted text preview: IOWA STATE UNIVERSITY- DEPARTMENT OF ECONOMICS Math Review for Principles of Microeconomics Econ 101 Fall 2007 1 Functions of one variable One variable is a function of another if the &rst variable depends upon the second. y = f ( x ) in the above expression we are denoting y as a function of x. Therefore, we call x the independent variable and y the dependent variable. examples: y = x (linear function) y = 3 + 4 x (linear function) y = x 4 + 5 x 3 + 56 (non linear function) All straight lines (linear functions) have the same general representation with an equation of the form: y = a + bx a is then called the vertical intercept , because it marks the point where the graph of the equation hits the vertical axis; b is the slope of the line, which tells us how much Y changes every time X changes by one unit. (FIGURE A.3) One does not need a mathematical formula to convey the idea that one variable is a function of another, a table can also show this relationship. Advertising expenditures Sales ($1,000 per month) ($1,000 per month) 2 24 3 27 6 36 7 39 11 51 12 54 This table de&nes monthly sales as a function of monthly advertising expenditures. We can write it as sales = f ( advertising ) ....
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This note was uploaded on 09/21/2008 for the course ECON 101 taught by Professor Brentkreider during the Spring '07 term at Iowa State.
- Spring '07