ECON101 Lecture Notes - Lecture 4: Marginalism, Negative Relationship, Economic Model

• School: University of Waterloo
• Department: Economics
• Course: ECON101
• Professor: Nafeez Fatima

Document Summary

Sept 18: graphs used in econ models: relationship b/w two variables, positive relationship (direct, three forms: linear, becoming steeper (convex), becoming less steep (concave) Negative relationship (inverse: three forms: linear, becoming steeper (concave), becoming less, so if the relatio(cid:374)ship (cid:272)ha(cid:374)ges o(cid:374)(cid:272)e you (cid:272)o(cid:373)(cid:271)i(cid:374)e dire(cid:272)t a(cid:374)d i(cid:374)(cid:448)erse, you"re go(cid:374)(cid:374)a ha(cid:448)e a maximum and minimum point or smth steep (convex) No relationship (unrelated variables: for any value of x, many values of y, for any value of y, many value of x. Negative: when one variable increases, the other decreases. Chapter 2: economic model of production (understand problem of production using economical way of thinking, use six key ideas from chapter one, scarcity, choices + trade offs, rationality, marginal analysis, opportunity cost. A hypothetical economy that produces only two goods: x and y. [i"(cid:448)e refere(cid:374)(cid:272)ed it as ppf for short i(cid:374) (cid:373)y (cid:374)otes: technology knowledge of how to produce better.