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    Chapter One - Appendix

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    hnoga75
    Economics

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    © All Rights Reserved
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    Chapter One - Appendix

    Uploaded by

    hnoga75
    5 views17 pages
    Economics

    Original Title

    Chapter One - Appendix (1)

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    © © All Rights Reserved

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    Economics

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    5 views17 pages

    Chapter One - Appendix

    Uploaded by

    hnoga75
    Economics

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 17

    Appendix to Chapter One – How to

    read Graphs?
    Noha Magdy Mostafa

    Assistant Lecturer of Economics, FEPS, Cairo


    University
    Graphs & Economics

    What is a graph ?

    • It is a diagram showing how two or more sets of data or variables are related to one another. Graphs
    are essential in economics because, among other reasons, they allow us to analyze economic
    concepts and examine historical trends.
    Graphs & Economics

    Accordingly,
    What is a variable ?

    • A variable is an item of interest that can be defined and measured and that takes on different values
    at different times or places.

    • Give Examples of important variables in Economics.


    Graphs & Economics

    Time Scatter
    Series Diagrams

    Some graphs show how Other graphs show the


    Types of relationship between
    variables change over time Graphs
    (time on the horizontal & the Different variables
    variable on the vertical ) (combination of variables over
    diff years)
    Examples of Graphs in Economics
    What events
    happened at the
    highlighted
    parts?

    Unemployment
    rates in
    percentages

    Year

    Unemployment Rate in Egypt over the period (2010-2020), source: trading Economics
    Examples of Graphs in Econ

    What events
    happened at the
    highlighted
    parts? Inflation rates
    in
    percentages

    Year

    Inflation Rate in Egypt over the last 10 years, source: trading Economics
    Examples of Graphs in Econ

    Interest rates
    in percentages

    Year

    Interest rates in Egypt over the last ten years, source: trading
    Economics
    Examples of Graphs in Econ

    Combination
    of variables
    for different
    years

    Analysis from Economist John Taylor covering data from 1990Q1 to 2010Q3.
    (Strong investment demand is associated with lower unemployment)
    Examples of Graphs in Econ
    Third Example of Graphs in Econ

    The PPF represents the maximum


    amounts of a pair of goods or services that
    can both be produced with an economy’s
    given resources, assuming that all
    resources are fully employed.
    Vertical
    Axis Feasible or
    attainable but
    As the quantity of sugar produced
    not efficient
    increases, the production of pizza falls.

    Horizontal
    Axis
    Slopes & opportunity costs

    (x1, y1) ---→ ?


    (x2,y2) ----→ ?

    When cotton
    production rises
    from 300 to 301.
    What is the
    precise change in
    wheat production
    that will take
    place?
    Defining the Slope
    • The slope is one important way to describe the relationship between two variables.

    • The slope of a line represents the change in one variable that occurs when another variable
    changes. More precisely, it is the change in the variable Y on the vertical axis per unit change
    in the variable X on the horizontal axis.

    • The slope could also be defined as an exact numerical measure of the relationship between
    the change in Y and the change in X.

    • Using slopes to calculate the marginal value in a relationship, example: marginal cost &
    marginal tax rates.
    Defining the Slope
    The slope measure the change in Y per unit change in X or the rise over the
    run (vertical distance/ horizontal distance) or (Y2-Y1)/(X2-X1).

    The value of
    For Flatter the Slope
    straight lines decreases

    For Steeper The value of


    the Slope
    straight lines increases
    The Slope of the line indicates whether the
    relationship between X and Y is…..

    A Direct Relationship (+ve slope)


    Variables tend to move in the same direction
    ( Income & Consumption )

    Differentiate
    between
    An Inverse Relationship (-ve slope)
    direction or sign Variables move in opposite directions
    on one hand and
    magnitude on the (Price & Quantity demanded)
    other hand
    Changing VS constant Slopes
    Time Sandwiches sales

    5:00 pm 0
    Changing Slope (Examples: Non-linear line or dome
    shaped)
    5:15 pm 7

    5:30 pm 25
    What is the sign
    5:45 pm 30
    of the slope
    value?

    Weeks Money in dollars

    0 0

    1 5

    2 10
    Constant Slope (Straight line)
    3 15
    Movement along & Shifts of a curve

    Having more of
    both at the same
    time

    How can we
    reach such
    shift?
    Choosing more of
    one and less of the
    other
    Thank You
    Contact: [email protected]

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