2_Graphs

# 2_Graphs - CHAPTER Making and Using Graphs 1A CHECKLIST...

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Making and Using Graphs CHAPTER 1A

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When you have completed your study of this appendix, you will be able to C H E C K L I S T Interpret a scatter diagram, a time-series graph, and a cross-section graph. 1 Interpret the graphs used in economic models. Define and calculate slope. Graph relationships among more than two variables. 2 3 4
Basic Idea A graph enables us to visualize the relationship between two variables. To make a graph, set two lines perpendicular to each other: The horizontal line is called the x -axis. The vertical line is called the y -axis. The common zero point is called the origin . MAKING AND USING GRAPHS

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MAKING AND USING GRAPHS Figure A1.1 How to make a graph The horizontal axis ( x- axis) measures temperature. The vertical axis ( y - axis) measures ice cream consumption.
MAKING AND USING GRAPHS Point A shows that when the temperature is 40 degrees, ice cream consumption is only 5 gallons a day. Point B shows that when the temperature is 80 degrees, ice cream consumption jumps to 20 gallons a day.

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MAKING AND USING GRAPHS Interpreting Data Graphs Scatter diagram A graph of the value of one variable against the value of another variable. Time-series graph A graph that measures time on the x -axis and the variable or variables in which we are interested on the y -axis.

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MAKING AND USING GRAPHS Trend A general tendency for the value of a variable to rise or fall. Cross-section graph A graph that shows the values of an economic variable for different groups in a population at a point in time.
MAKING AND USING GRAPHS Figure A1.2(a) shows a scatter diagram. The data for 1995 to

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2_Graphs - CHAPTER Making and Using Graphs 1A CHECKLIST...

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