Principles of Macroeconomics / Unit 3 MAC 0223 worked example, 60 to 90 seconds
Reading a Series Honestly
The idea
The same true series can be drawn to tell opposite stories, and four choices do it. Stretching the horizontal axis flattens a spike; stretching the vertical axis magnifies every wobble. Choosing where the vertical scale starts and stops makes the same movement look large or small. Averaging the data over longer intervals smooths away the peaks that were the point. And choosing where the series begins and ends can make a flat record look like a steady rise or fall. None of the four requires a single false number.
In practice
Worked example: one unemployment series, drawn four ways. Plotted wide and short, a sharp rise looks unremarkable. Plotted tall and narrow, the same rise looks alarming. Scaled from zero to thirty percent it nearly vanishes; scaled from three to ten percent it dominates. Averaged over five-year blocks the spike disappears entirely, and started from a historical high it reads as a long decline.
Where people slip
Accuracy and honesty are different tests, and this course's own figures are subject to both. Before accepting what a chart shows, check the axis range, the interval, and the start date, and ask what the series would look like drawn another way.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
Builds on
Unlocks
- Nothing yet depends on this.
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