Working with equations, graphs, and tables The importance being able to work smoothly between information presented in tabular, graphical, and equation form is extremely important in the study of economics. Since much of what you will be studying has to do with relationships between and among variables that can be best expressed numerically, brushing up on your skills is a good idea. Exploration: The Appendix to Chapter 1 is devoted to practicing with linear (straight-line) relationships between variables. Be sure that you have read the appendix and are reasonably comfortable with the material before beginning this exercise as it draws heavily from the text. | 1. |
In Example A.1 you are told that your long distance telephone plan charges $5.00 per month plus 10 cents per minute for calls. Express the relationship as an equation.
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Using the information from question one, find the cost for 10 minutes of calls.
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The scale on the axes matter a great deal in graphing. Graph the equation for phone charges. To do this press the Plot Equation button with 5 in the Y intercept and 0.1 in the Slope boxes. note how it looks – nearly flat and difficult to read. Without changing the numbering on the axes, how might you change the slope so that the graph is more readable?
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Moving away from the phone charge example from the book, suppose you don't know the slope, but do know the Y intercept and one other point. If the Fixed cost is $10 and we know that 4 units cost $14, what is the equation for the line?
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Without using the applet, how might you have found the slope of the equation?
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In all the examples we have used thus far the slope has been a positive number yielding a graph that rose from left to right. Suppose we are dealing with something that decreases rather than increases? For example, suppose that at a price of zero people would want 90 widgets per day, but as price rises they would want fewer and fewer, at a rate of 7 fewer per dollar increase in price. Using the applet, establish and plot the appropriate equation.
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In the question above, what is the quantity demanded of widgets if the price is 8 dollars each?
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View Answers Exercise picked up from the 2e Macroeconomics textbook. |
