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Graph Review for EC 1
Throughout this course, you often need to read and draw graph.
The purpose of these
class notes is to review the basic aspects of graphing that will be used throughout the
course.
How to read and draw a two variable graph is discussed below.
The topics that
you should master are:
1)
Coordinate System
2)
Linear Graph
3)
Nonlinear Graph
1.
Coordinate System
We can use the coordinate system to summarize the relationship between 2 variables as
follows.
As far as which variable should be in the yaxis or on the xaxis (if there is causation
between two variables, i.e. a change in one variable determines the change in another),
the convention is that the yvariable or yaxis is the dependent variable, whereas the x
variable or xaxis is the independent variable.
In other words, the change in x will result
in the change in y, not the other way around.
However, the readers should take the
convention with caution because sometimes we do not follow this convention in
economics.
For example, we put
quantity – a dependent variable – in the xaxis and
price – an independent variable – in the yaxis
.
On the other hand, we put
consumption
– a dependent variable – in the yaxis and income – an independent variable – in the x
axis
.
2.
Linear Graph
When the two variables have a linear relationship (an increase in one unit of x will result
in a constant increase in y at any value of x), we can use the straight line to summarize
the relationship between the two as follows:
y = ax + b
Where
y = variable in the yaxis
x = variable in the xaxis
values
(3,3)
(4,7)
origin (0,0)
y
x
x
y
+

+

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a = slope of the linear graph (constant value) =
x
y
Δ
Δ
b = vertical intercept of the linear graph (the value of y when x is 0)
Hence, we can represent the above equation using a linear graph as follows.
s
l
o
p
e
=
a
=
7
2
16
4
5
12
2
7
4
16
−
−
=
=
−
−
=
Δ
Δ
x
y
Now, let us compare different graphs.
2.1
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This note was uploaded on 03/20/2008 for the course ECON 1 taught by Professor Nagata during the Fall '08 term at UCLA.
 Fall '08
 Nagata

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