Your Telephone Service Provider Charges a Fixed Monthly Fee of $80.00

question 242

Short Answer

Your telephone service provider charges a fixed monthly fee of $80.00 plus $0.10 cents per call for calls within Canada and $0.50 per minute for international calls. Under this plan what is your monthly phone cost if you make 100 calls within Canada and 45 minutes of international calls?

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Definitions:

Present Consumption

The use of goods and services for immediate satisfaction or needs, as opposed to saving or investing for future use.

Behavioral Economists

Economists who study the effects of psychological, social, cognitive, and emotional factors on the economic decisions of individuals and institutions and how those decisions vary from those implied by classical theory.

System 2

A concept from cognitive psychology that refers to the deliberate, analytical, and slow way of thinking, as opposed to quick, instinctual decisions.

Endowment Effect

The tendency for people to value something more highly simply because they own it.