\documentclass{standalone}
\usepackage[utf8]{inputenc}
\usepackage{tikz}
\begin{document}
\def\n{1}
\def\I{0.7}
\def\II{1.42857}
\begin{tikzpicture}[domain=0:2, xscale=2, yscale=2, >=latex]
\draw[very thin,color=gray!30] (0,0)
grid[xstep=0.25, ystep=0.25] (2,2);
\draw[->, line width=1pt] (0,0) -- (2,0)
node[below] {$x$};
\draw[->, line width=1pt] (0,0) -- (0,2)
node[left] {$y$};
\draw[color=green!30!black, thick, smooth]
plot[id=x, domain=0.5:2]
function{\n/x};
\draw[dashed, color=gray] (0,0) node[below] {$O$} -- (2,2);
\node[anchor=base] (vg) at (0.9,1.8)
{$y = \displaystyle\frac{c}{x}$};
%\draw[->,dashed] (\I,0) node[below] {$x_0$} -- (\I,\II) -- (0,\II)
% node[left] {$y_0$};
%\draw[->,dashed] (\I,0) node[below] {$x_0$} -- (\I,\II) -- (0,\II)
% node[left] {$y_0$};
\draw[->,dashed] (\I,\I) -- (\I,\II);
\draw[->,dashed] (\I,\II) -- (\II,\II) ;
\draw[->,dashed] (\II,\II) -- (\II,\I);
\draw[->,dashed] (\II,\I) -- (\I,\I);
\draw[dashed] (\I,0) node[below] {$x_0$} -- (\I,\I) -- (\II,\I) -- (\II,0)
node[below] {$x_1$};
\end{tikzpicture}
\end{document}
