1. graphical analysis : The process of investigating economic phenomena in a systematic manner using graphs and diagrams.

Graphical analysis is a common type of economic analysis.

2. An Example Graphical Analysis Exercise

Circumference vs. diameter of cylinders We'll use a familiar situation as another example of the graphical analysis procedure. Suppose we have a collection of cylinders of different diameters ranging from 1 to 4 centimeters. Our goal is to experimentally determine the relationship between the circumference and the diameter and compare the results to what we expect from mathematical theory. Here's how the measurements are made. In order to find the circumference of each cylinder, a pencil mark is placed on one end of the cylinder. Then the cylinder is rolled without slipping across a piece of paper until two marks appear on the paper. The distance between the marks is measured with a ruler. The series of sketches below illustrate the process.

1.) Example data and a graph are shown below. Cylinder ID 1 2 3 4 5 Diameter Circumference (m) (m) 0.0120 0.0163 0.0195 0.0253 0.0390 0.0398 0.0505 0.0612 0.0797 0.1250

Theoretically, we expect the circumference to be proportional to the diameter. So it's no surprise that the graph above appears linear. Therefore, we draw a best fit straight line through the data points, find the slope and intercept, and write the equation of the line. This is shown below.

2.)

slope = (C2 - C1)/(D2 - D1) = (0.111 m - 0.015 m)/(0.0350 m - 0.0050 m) = 3.20 (units divide out) intercept = -0.001 m Equation of best fit line: C = 3.20D - 0.001 m The above equation is an experimentally-determined relationship between circumference and diameter. However, we also know from theory that C = (pi)D, where pi is 3.14 to 3 significant figures. Therefore, we can say that we expect the slope of the experimental relationship to be pi and the intercept to be 0. In this case, experiment and theory agree on the value of the slope to within 2%. This and the small size of the intercept are easily explained by the errors inherent in the methods of measuring circumference and diameter.