Econ110: Principles of Economics
TEST YOUR UNDERSTANDING
1) Graph the following two equations:
Y = −100 + 50 X and Y = 200 − 25 X
250
225
200
175
Y
150
125
100
75
50
25
0
0
1
2
3
4
5
X
6
7
8
9
10
2) Write down the equations of the lines drawn in the below figure.
Y 40
35
30
25
III
20
II
15
10
I
5
0
0
2000
4000
6000
8000
10000
12000
14000
X
3) a) For each of the following equations find the slope and the intercept.
Y
Y
Y
Y
€
€
€
€
= 10 − 0.03X
= 35X − 3
= 0.25X
=5
b) For each of the equations given above, determine whether the two variables are
positively or negatively related?
4) Different electricity plans (Plan I, Plan II and Plan III) available through three
different companies who serve Central Ohio are given below.
100
90
Plan II
80
Plan III
monthly electricity bill ($)
70
60
50
Plan I
40
30
20
10
0
a)
b)
c)
d)
e)
0
100
200
300
400
500
600
700
monthly usage (kWh)
800
900
1000
If your monthly usage is 800 kWh, how much would you pay under each plan?
Determine the range of monthly usage for which Plan I is the cheapest option.
Determine the range of monthly usage for which Plan II is the cheapest option.
Determine the range of monthly usage for which Plan III is the cheapest option.
Plan II can be described as “$0.10 per kWh with no fixed monthly fee”.
Give a similar verbal description for the other two plans.
1100
1200