ECO182C - Review of Graphs

ECO182C - Review of Graphs - Review of Concepts 1....

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1 Review of Concepts 1. Introduction to Graphs 2. Linear Equations 3. Solving Linear Equations 4. Percentage Changes 1. Introduction to Graphs What do the two axis measure? ± Graphs are visual relationship between variables ± Easy way to represent complicated relationships ± Value of X is measured on ‘horizontal’ axis and Y is measured on ‘vertical’ axis ± At the center is the point where both x and y are 0 called origin X(+ve) Y(-ve) X(-ve) Y(+ve) (0,0) What is the direction of change along the axis? ± Value of X is positive and increasing as we move to the right from the origin ± Value of X is negative and decreasing as we move to the left from the origin ± Value of Y is positive and increasing as we move up from the origin Vl fYi t i dd i d f th ± Value of Y is negative and decreasing as we move down from the origin X(+ve) X(-ve) Y(+ve) Y(-ve) X increasing Y increasing Y decreasing X decreasing (0,0) How do we plot a point on the graph? ± To plot a point X=5 and Y=7 denoted as (5,7) ± We move right of the origin where X = 0 by 5 units ± Then we move up from the point where Y = 0 by 7 units ± We then find where a vertical line from the point where X = 5 and a horizontal line from the point where Y = 7 intersect and this is our point (0,0) 7 5 5,7 Use of Graphs in Economics ± Most of the relationships studied in economics only consider positive values of the variables of interest ± Hence, economists usually show the upper right portion of the coordinate system
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2 ± Suppose the horizontal axis measures Quantity (Q) and vertical axis measures price (P). A positive linear relationship between P and Q is
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ECO182C - Review of Graphs - Review of Concepts 1....

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