Economics, 3rd Edition

34  PART 1  INTRODUCTION TO ECONOMICS

Using the Coordinate System

Final examination mark is measured on the 

vertical axis and study time on the horizontal 

axis. Albert, Alfred and the other students on 

their course are represented by various points. 

We can see from the graph that students who 

spend more hours studying tend to get higher 

marks.

U i

th

C

di

t

FIGURE 2A.3

Ex

amination mar

k (%)

80

90

100

Alfred E.

(5, 2.0)

Albert E.

(25, 3.5)

70

60

50

40

30

20

10

0

0

5

10

15

20

25

30

35

40

45

Study time (hours per week)

Limitations of Scatter Plot Graphs 

Looking at the scatter plot in Figure 2A.3, it seems intuitively sensible 

that more time devoted to study is associated with higher marks. But just because two variables appear 

to have a relationship does not mean we can simply accept the data at face value. As economists we have 

to be critical – we have to question what we see. The following example highlights this issue.

Assume that data are released in a particular area which we shall call Region X, which shows a rise 

in the number of new born babies over a period of time. At the same time, it is observed that the stork 

population in Region X has also risen over the same period of time. There is a ‘theory’ that storks bring 

babies. This ‘theory’ comes from the belief that storks are a fertility symbol. Storks live in and around 

marsh and wetland areas. There was also an ancient belief that the souls of unborn babies lived in water 

and that storks carried these souls to mothers – hence the belief that storks bring babies.