Lesson 2
Variables, equations, and functions
Big question
How can we write economic ideas in a compact way?
Lesson progress
Complete checkpoints as you learn
Learning objectives
- Explain variables, equations, and functions in plain language.
- Use variable correctly in an interpretation.
- Connect the lesson idea to a formula, graph, Python result, or real example.
Simple explanation
A variable is a measured item, such as wage or education. An equation states a relationship, and a function says one value depends on one or more other values. These ideas help us move from a sentence to a model.
Key terms
- Variable
- A quantity that can change across people, places, or time.
- Equation
- A statement that two expressions are equal.
- Function
- A rule that maps inputs to an output.
- Input
- A value used to explain, predict, or calculate another value.
Simple function
This says wage may depend on education and experience.
Example
If wage depends on education and experience, two people with different education or experience may have different predicted wages.
A simple wage rule
1education = 162experience = 53predicted_wage = 8 + 1.5 * education + 0.6 * experience4print(predicted_wage)Checkpoint activity
Pause and explain this lesson's main idea in your own words before moving forward.
Try it yourself
Write one plain-English sentence explaining the main idea from this lesson.
Common mistakes
Check these before you move on.
A regression coefficient describes a pattern unless the assumptions or research design support a causal interpretation.
Quick quiz
In wage = f(education), what is education?
Key takeaway
Variables, equations, and functions let us write economic relationships clearly.