econ quiz 1
kentucky79
Tucker.Ch01ALECTURESLIDESEFT9e.pptAppendix to Chapter 1 Applying Graphs to Economics
1
Lecture Slides
Economics for Today
Irvin B. Tucker
(c) South-Western, a part of Cengage Learning
(c) South-Western, a part of Cengage Learning
What is a
direct relationship between two variables?
- When one increases, the other increases and vice versa
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© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
(c) South-Western, a part of Cengage Learning
(c) South-Western, a part of Cengage Learning
Exhibit A-1 Expenditure for a Personal Computer at Different Annual Incomes
Point
Personal computer expenditure
Annual income
(thousands of dollars)
(thousands of dollars per year)
A $1 $10
B 2 20
C 3 30
D 4 40
*
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
(c) South-Western, a part of Cengage Learning
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(c) South-Western, a part of Cengage Learning
4
3
2
1
10
20
30
40
A
B
C
D
Y=1
X=10
Exhibit A-1 A Direct Relationship Between Variables
Annual Income (thousands of dollars)
Personal Computer Expenditure (thousands of dollars per year)
0
Y
X
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© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
X=30
Y=3
What is an inverse relationship between two variables?
- When one increases, the other decreases and vice versa
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© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
Exhibit A-2 The Quantity of Compact Discs Consumers Purchased at Different Prices
Point
Price per compact disc
Quantity of compact discs purchased (millions per year)
A $25 0
B 20 25
C 15 50
D 10 75
E 5 100
*
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
20
15
10
5
25
50
75
100
B
C
D
E
Y=5
X=25
Exhibit A-2 An Inverse Relationship Between Variables
Quantity of Compact Discs Purchased (millions per year)
Price per Compact Disc (dollars)
0
Y
X
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© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
A
What is the slope of a line?
- The ratio of change in the variable on the vertical axis (the rise or fall) to change in the variable on the horizontal axis (the run)
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© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
Slope = rise/run =
vertical axis/horizontal axis = Y/X
*
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
What is an independent relationship between two variables?
- When one variable changes, the other variable is unchanged
*
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
Exhibit A-3 Expenditure for Toothpaste
at Different Annual Incomes
Point
Toothpaste expenditure (dollars per year)
Annual income (thousands of dollars)
A $20 $10
B 20 20
C 20 30
D 20 40
*
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
40
30
20
10
10
20
30
40
A
D
Y=0
X=10
B
C
Exhibit A-3 An Independent Relationship Between Variables
Annual Income (thousands of dollars)
Toothpaste Expenditure (dollars per year)
0
Y
X
*
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
How can I tell the difference between a movement along a curve and a shift in the curve?
- When price changes, there is movement along a curve. When a variable other than price changes, the whole curve shifts
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© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
What is an example of a change in a variable other than price?
- When income increases the whole demand curve shifts rightward
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© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
20
15
10
5
25
50
75
100
0
125
150
25
30
Exhibit A- 4 Changes in Price, Quantity, and Income in Two Dimensions
Quantity of Compact Discs Purchased (millions per year)
Price per Compact Disc (dollars)
Annual Income $60,000
Annual Income $30,000
*
© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
END
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