Scenario 5-4 ​

question 53

Short Answer

Scenario 5-4
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Consider the markets for mobile and landline telephone service. Suppose that when the average income of residents of Plainville is $55,000 per year, the quantity demanded of landline telephone service is 12,500 and the quantity demanded of mobile service is 28,000. Suppose that when the price of mobile service rises from $100 to $120 per month, the quantity demanded of landline service decreases to 11,000. Suppose also that when the average income increases to $60,000, the quantity demanded of mobile service increases to 33,000.
-Refer to Scenario 5-6. Considering the income elasticity, what type of good is mobile telephone service?

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Definitions:

Emotional care

Providing support that addresses the emotional and psychological well-being of an individual.

Selective optimization

A strategy of focusing on and optimizing key areas of functioning while compensating for declines in other areas, often used in the context of aging.

Compensation

The act of making amends for something inadequate or a loss, often referring to payment given for work done or for the settlement of a claim.

Successful development

The process of achieving personal, social, and professional milestones that are considered markers of progress and fulfillment across the lifespan.