1Graphs and Their MeaningMcGraw-Hill/IrwinCopyright 2012 by The McGraw-Hill Companies, Inc. All rights reserved.Appendix

Construction of a GraphLO7TableGraphIncomeConsumptionPoint$ 0100200300400$ 50 100 150 200 250abcdeConsumption (C)Income (Y) $100 200 300 400abcde$400 300 200

100

0

Direct and Inverse RelationshipsLO7 Direct relationshipBoth variables move up or down together

Direct and Inverse Relationships Inverse relationshipLO7Variables move opposite of each other

Slope of a LineLO7Consumption (C)Income (Y) $100 200 300 400$400 300 200

100

0 Positive slope of a straight lineSlope =Vertical ChangeHorizontal Change+50+100= 0.5==50100VerticalChangeHorizontal Change

Slope of a LineLO7

Slope of a Line Negative slope of a straight lineLO7Slope =Vertical ChangeHorizontal Change=-10+4=-25040302010 4 8 12 16 20-104Horizontal ChangeVerticalChangeTicket Price $Attendance=-2.5

LO7Slope of a LineSlopes and measurement unitsSlopes and marginal analysisInfinite and zero slopes

LO7Price of BananasConsumptionWatch PurchasesDivorce RateSlope = InfiniteSlope = ZeroSlope of a Line

LO7Equation of a Linear Relationshipy = a + bxy is the dependent variablea is the vertical interceptb is the slope of the linex is the independent variable

Equation of a LineLO7Consumption (C)Income (Y) $100 200 300 400$400 300 200

100

0Y = 50 + .5C

Equation of a LineP = 50 2.5QLO75040302010 4 8 12 16 20Ticket PriceAttendance

LO7Slope of a Nonlinear CurveSlope always changesMust use a line tangent to the curve to find the slope at that point

Slope of a Nonlinear CurveLO720

15

10

5

05 10 15 20 Use tangent lines to find the slope

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