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The slope depends on the way the relevant variables are measured. SLOPES AND MARGINAL ANALYSIS

Recall that economics is largely concerned with changes from the status quo. The concept of slope is important in economics because it reflects marginal changes— those involving one more (or one less) unit. For example, in Figure A1-1 the .5 slope

Part One • An Introduction to Economics and the Economy verticaL intercept The point at which a line meets the vertical axis of a graph.

shows that $.50 of extra or marginal consumption is associated with each $1 change in income. In this example, people collectively will consume $.50 of any $1 increase in their incomes and reduce their consumption by $.50 for each $1 decline in income.

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